Baroness Thornton: My Lords, I beg to move that this Bill be now read a second time.
	It is an honour and a pleasure to introduce this Bill to your Lordships' House. I pay tribute to my noble friend Lady Morgan of Drefelin, whose Bill this was before she joined the Government Front Bench as a Whip at Christmas. We were both wondering whether she might find herself having to deal with her former Bill from her new position; and I think we are both relieved to find that this is not the case.
	I am immensely flattered that the noble Lord, Lord Krebs, has chosen to make his maiden speech during this debate. He is without doubt the expert, and he is largely responsible for producing the science and information that has allowed this issue to come to the top of the public policy agenda. I, for one, am looking forward to his contribution to the debate, and I welcome him to life in your Lordships' House.
	I place on record my gratitude to Sustain and to the Children's Food Campaign for their support and briefing, not just to me but to many noble Lords who have chosen to participate in this debate, particularly those who are supporting the Bill.
	One of the reasons why I was convinced that this was an important and vital cause to support was the range and impressiveness of the support from more than 300 organisations and 12,000 members of the public, some of them distinguished scientists and chefs, such as Sophie Grigson, who joined me at a meeting with children and parents before today's debate. Chefs such as Raymond Blanc, Prue Leith, Antony Worrall Thompson, and parents like me, are committed to improving the diet and health of the UK's children and young people.
	The British Heart Foundation, Cancer Research UK, Which?, the Children's Commissioner, the Consumers' Association, Diabetes UK, the British Medical Association and many other organisations have written to give me their support. More than100 Members of your Lordships' House have written to me offering support, and many apologised for not being here today. We might miss them, but in terms of the length of the debate, we might be relieved that they could not all be here to speak. I am delighted and grateful for their response, as I am to noble Lords who have chosen to be here today to participate in the Second Reading debate, even if they disagree with me.
	Noble Lords might wish to know that Early Day Motion 404 in the other place has now gathered233 signatures from across the parties in support of the proposals in the Bill. The Bill is in two parts. It will end television advertising for high in fat, salt and sugar—HFSS—food and drink before 9 pm, it will restrict the advertising of food "ranges" with HFSS items in them before 9 pm and finally it seeks to prevent the sponsorship of pre-watershed programmes by HFSS products.
	The Bill seeks to do that by defining a watershed that covers most of the time when children might be watching television, but it is not limited to what are commonly known as "children's viewing times". It seeks to find a form of words that would cover not only foods that are high in fat, salt and sugar, but that will deal with the manufacturers and producers of brands of those foods, hence the use of the phrase "range of foods" in Clause 1(4). Clause 2 seeks to use the classification and models that are already in existence to classify foods, particularly because those are the nutritional classifications that have been used by Ofcom in its deliberations about the restrictions on advertising to children.
	Why is this Bill necessary now, when, as I am sure the Minister will tell us later in the debate, the Ofcom-recommended restrictions are only just being introduced? It is no exaggeration to say that there is a crisis in children's diets. The National Diet and Nutrition Survey found that 92 per cent of children consume more saturated fat than is recommended;86 per cent consume too much sugar; 72 per cent consume too much salt and 96 per cent do not get enough fruit and vegetables. The Chief Medical Officer has compared the crisis in children's diets to a health "time bomb" that must be defused.
	It is to our shame that the UK now has the highest rate of obesity in Europe, and childhood obesity is rising at an alarming rate. One in three children is now overweight or obese. Obesity in children under 11 has risen by over 40 per cent in 10 years. If that trend continues, half of children will be obese or overweight by 2020. The Government have set themselves a target to halt the rise in obesity by 2010. The Bill points to the fact that that will not be achieved unless urgent measures are taken.
	The consequences of childhood obesity are now clear. Incidences of high blood pressure, raised cholesterol and even clogged arteries in children are rising. Obesity in childhood is likely to develop into obesity in adulthood, increasing the risk of heart disease, diabetes or cancer. Ten years ago, type 2 diabetes in UK children was reported as an anomaly; today, there are up to 1,000 known cases, all of which can be directly attributed to an increasingly poor diet and lack of physical activity. The prevalence in children could be over 50 per cent by 2020 if the current trend continues.
	The psychological impact of obesity can be as damaging as the physical for many children. Being overweight or obese is associated with increased levels of distress, disadvantage and psychological problems. Alongside the problems associated with obesity, junk food diets are causing other health problems. I have mentioned type 2 diabetes, but junk food diets also have significant effects on children's behaviour, concentration, learning ability and mood. Many noble Lords who are parents will know about the sugar high and spike that our children experience. I have one daughter, and we used to say that she climbed the walls if she got the wrong kind of sugar and additives in the sweets that she had access to from time to time, despite my best efforts. Children with diets lacking in essential vitamins, minerals and fatty acids tend to perform worse academically, cannot concentrate and can be more aggressive.
	A great deal of this will be familiar to noble Lords, Ofcom and the Government. All that information helped to inform Ofcom in its deliberations last year when it was deciding the precise recommendations about the restrictions on advertising of certain foods. I pay tribute to the thorough way that it set out to define the scale of the problem, although I note that Ofcom was asked to undertake that task in December 2003 by the Secretary of State, Tessa Jowell. The four years that it has taken to get to this point is no doubt due to the comprehensive nature of the analysis Ofcom undertook of the available scientific and audience data to assess the extent to which television advertising influenced children's food preferences.
	I also pay tribute to the Food Standards Agency for providing us with nutrient profiling which defines food and drink products rated as high in fat, salt and sugar, about which there will no doubt be more from the noble Lord, Lord Krebs. I am reassured that Ofcom will continue to look to the FSA to ensure that the nutrient profiling scheme remains in line with scientific thinking as it evolves.
	My contention, and I think that of many others today, is that the conclusion that Ofcom came to from its deliberations and the resulting proposals are inadequate given the scale and urgency of this problem. We cannot wait another year for the proposals to be enacted, then another two or three years to find out that they are inadequate, and then perhaps even more years to find a firmer remedy. The UK's children do not have that time to wait, and deserve better. This Bill therefore lays down a challenge to Ofcom and the Government to get serious with the issue. It does so with a huge amount of public support. If Ofcom and the Government believe their own research by their own experts, why are they not prepared to take the steps necessary to have a real impact?
	The Bill is not the silver bullet that will solve overnight the problems of child obesity, diet and lack of exercise. Of course, it is not up to the Houseof Lords to substitute for parents and their responsibilities. The most important people in this equation are parents and families, and then there are teachers and other carers, youth workers, doctors and so on, all of whom have important jobs in educating and persuading children and young people to eat sensibly and well. But all the good work of schools and the efforts of parents are being undermined by the torrent of advertising for less healthy food. The average child sees 18,000 adverts a year.
	A recent British Heart Foundation survey found that 68 per cent of parents were in favour of pre-9 pm restrictions on junk food advertising, while only 7 per cent were against them. Which? found in a 2006 survey that 79 per cent of parents believe that unhealthy foods should not be advertised when children are most likely to watch television. Ofcom found in 2004 that 81 per cent of parents and carers wanted some form of regulation of the advertising of junk food products, while just 11 per cent wanted no change. Some 48 per cent supported a ban on junk food advertising before 9 pm, and 24 per cent opposed it.
	Professor Hastings, in his distinguished review published in 2003 on the impact of broadcast food and drink promotion on children's eating behaviour, found not only that there was a substantial amountof food advertising for children, but that food promotion affects children's preferences and what they decide to buy and eat. Those findings were further endorsed by additional research that Ofcom carried out before it initiated its 2006 consultation and research published in the Lancet.
	It is therefore clear not only that children are being subjected to considerable high fat, salt and sugar food TV advertising, but that this in turn affects their eating habits. Some 80 per cent of the junk food advertising that children are subjected to is on television. The Hastings review on the effect of television advertising demonstrated that this has a significant influence on not only their preferences, but their purchasing behaviour—and the pressure that they put on their parents and family in their purchasing behaviour, and on their friends through peer group pressure.
	The problem is that Ofcom's recommendations for restrictions on junk food advertising do not properly protect children from it and contain a significant number of loopholes. Ofcom's proposals effectively prevent the advertising of junk food only during the hours of children's television, and 71 per cent of television watched by children falls outside those hours, so we have a serious problem. Research by Which? found that none of the 26 commercial television programmes watched by most children was covered by Ofcom's proposed regulations. These are programmes such as "Coronation Street" and "Ant and Dec's Saturday Night Takeaway", which has 11 million viewers. They are not covered by the Ofcom regulations. It is estimated that imposing a watershed at 9 pm could save the nation up a billion pounds a year, at a cost to the industry of only £150 million a year—less than half of ITV's latest dividend to shareholders. The Bill will encourage TV advertising for healthier products. This may well encourage children to eat healthier foods.
	Ofcom's failure to place any restrictions on brand advertising allowed a significant loophole for food companies producing products that are high in fat, sugar and salt (HFSS). Its recommendations do not apply to brand advertising where no products are shown. For example, you could advertise the golden arches of McDonald's, which are recognised even by a large number of three-year-olds, without showing a hamburger. Thereby, companies have the freedom to promote their products via their brands. Even Ofcom admitted that:
	"If there are no restrictions on brands, there is a risk that manufacturers of HFSS products might seek to use brand advertising and especially brand sponsorship to substitute for the loss of product advertising opportunities".
	It is up to the Government to get Ofcom out of this dilemma. Ofcom probably also believes that it is up to the Government and this Parliament to make sure that the watchdog can take the necessary steps to end such brand advertising. There is every reason to expect that loopholes in HFSS advertising regulation will be exploited by food and drink companies and their advertising agencies, leading to continued marketing pressure on children from companies promoting fast food, snacks, confectionery and soft drinks.
	This Bill tackles the issue of brand advertising by preventing advertising for any range of food that includes HFSS items, although advertising of any non-HFSS product within that range is still allowed. This will mean that much brand advertising is controlled, without harming advertising for healthier products.
	In conclusion, I urge the Government to follow the logic of their own research, the logic of their stated public aims, and to follow the views of many respected scientists, the medical profession, teachers and the vast majority of parents and families who support the Bill. I am aware that there would be an impact on profits in the commercial television world. Indeed, one television channel wrote to me to tell me of the detrimental effect that my proposals would have on its ability to make children's programmes. I do not deny that there would be such an effect, although, like the doom mongers who opposed the ban on cigarette advertising and indeed smoking in public places, it is probably exaggerated. However, there is a greater good here that cannot be denied.
	I have several reasons to be optimistic that we will succeed. Apart from the fact, as my children and their friends say, that it is a bit of a no-brainer, in an interview on GMTV on 25 October 2006, the Chancellor of the Exchequer, Gordon Brown, gave his support for pre-9 pm watershed restrictions on junk food advertising to children, stating:
	"We have got to do something about television advertising before the watershed hour".
	I commend the Bill to the House.
	Moved, That the Bill be now read a second time.—(Baroness Thornton.)

Baroness Buscombe: My Lords, I begin by declaring an interest as chief executive of the Advertising Association. If a ban on the advertising of foods high in fat, sugar and salt solved the problem of obesity in Britain, how simple life would be. Unfortunately, life is not that simple and I am afraid that this Bill is a classic case of a quick-fix solution to a complex problem.
	Advertising is an easy target, but advertising bans have unintended consequences and will not tackle the root causes of the problem of obesity. Obesity is a hugely important and multi-faceted social issue that must be taken seriously. The increase in obesity can be attributed to a complex range of inter-relating causal factors, including changes in lifestyle and diet, and social, environmental and cultural factors. Both Ofcom and the Food Standards Agency have acknowledged this.
	Recommendations on advertising comprised only three of the 91 recommendations in the Government's 2004 Choosing Health White Paper. One might well ask what happened to the other 88, especially given the huge amount of activity and change that has taken place in the reformulation of food and marketing to children. Not only would a watershed be damaging and disproportionate, but it is not evidence-based; it is certainly not rational to introduce yet more changes when the current ones are only just being phased in.
	The pressure groups behind this Bill advocatea 9 pm watershed on the grounds that it will significantly reduce exposure of food advertising to children up to 15 years of age. This view has evolved from Ofcom's 2004 research, which showed that70 per cent of children's viewing is outside children's airtime. In fact, this is an oversimplification of the figures and children's exposure to adult viewing is considerably less.
	Ofcom was asked in 2004 to research the impact of television advertising of food and drink to children and to consider proposals on tightening the rules on television advertising. Its comprehensive and evidence-based report concluded that food advertising had "modest direct effect"—around only 2 per cent—on children's food choices. It also said that indirect effects were likely to be larger but that there was insufficient evidence to quantify the indirect effect of TV advertising on children's food preferences, consumption and behaviour, by comparison with other relevant factors such as exercise, trends in family eating habits, school policy and food labelling.
	Ofcom decided that there was a case for strengthening advertising rules but concluded that a total ban on pre-watershed television advertising of food and drinks to children would be neither proportionate nor, in isolation, effective. Indeed, it recognised that this "nuclear option" would not be sufficiently targeted and would be disproportionate. Its chief executive, Ed Richards, confirmed that it would reduce broadcaster revenues by a sum greater than the entire commercial TV industry's combined expenditure on all children's programming and national news coverage and that it would cut,
	"a swath through quality British made programmes on our TV screens".
	It is often forgotten that TV food advertising expenditure has been declining since the beginning of this decade, yet obesity in younger children continues to rise. The evidence is just not there to support the restrictions that this Bill would impose. Instead, it is time for government and politicians to face up to uncomfortable truths. In the United States, the attention on obesity is rightly focused, by inspirational organisations such as the Johnson and Johnson Foundation, on the balance between "energy in", or food intake, and "energy out", or exercise, of children. I suggest that the FSA and the Government would do well to look at what Johnson and Johnson is doing on this.
	Politicians in this country must face up to the fact that ideological posturing by both left and right has harmed children. Doctrinaire positions on the selling of playing fields and the banning of team sports in schools have failed a generation of children. Only this week we heard from the Children's Society that parents are afraid to let their children go out and play by themselves and explore and grow as individuals. On Wednesday morning we heard two health professors, Professor Wardle and Professor Fox, on Radio 4's "Today" programme, explain that the increase in obesity is due to a chronic imbalance of eating and exercise, with a lack of healthier food at lower prices and the microwave contributing to an overweight nation. Advertising is an easy target when politicians do not want to blame either themselvesor the lack of responsibility exercised by their constituents. Yet if we really want to tackle the root causes of obesity, this is where we should be looking.
	Frankly, the bizarre posturing of consumerist groups on this issue is as damaging as it is perplexing. Generating a bandwagon of C-list celebrities looking for attention and of contenders for the deputy leadership of the Labour Party, as has been attempted in support of this Bill, is not serious politics. It leaves a bad taste in the mouth and raises the serious question of why these self-styled consumerist groups behind the Bill are not campaigning on more serious problems and the root causes of obesity.
	It is worth noting that the Bill is being promoted by the pressure group Sustain, which I note is funded by farming groups, such as the National Farmers' Union, and by Baby Milk Action and other related organisations. I wonder how those unbelievably hard-pressed dairy and pig farmers would feel if they realised that their produce—cream, butter, cheese and sausages—is all already classed as junk food according to the FSA nutrient profiling. Indeed mothers' milk, if it could be advertised, would be banned as well. Farmers are effectively funding an organisation, Sustain, which we can only deduce is happy to destroy them.
	At a time when we habitually read of killings of children by other children and of drug, substance and physical abuse, why is there such a disproportionate and hysterical agenda against advertising being conducted by groups that claim to campaign for the common good?
	Perhaps the most disheartening aspect of all this was to watch the British Medical Association leap on this bandwagon. It is in such a powerful position to make a real difference and it should be asking itself what thousands of GPs are doing to help obese patients. Instead, its only excuse for posturing on this issue is to cite the very dubious research—indeed, it is not really research—compiled by the increasingly sensationalist and commercial Which? magazine.
	We have to stop being afraid of saying what has to be said. The quick fix of restricting food advertising has already brought consequences that are way beyond what was intended and has possibly brought more harmful effects than beneficial ones. Around £40 million of ad revenue per annum has been taken out of the TV market, in addition to the losses that commercial broadcasters have already incurred as advertisers have, over the past couple of years, voluntarily withdrawn from advertising during children's programme times. This is yet another disincentive for broadcasters to invest in quality, UK-originated children's programming, let alone to increase spend. So-called "junk food" advertising may well be replaced with much worse "junk TV" for children.
	A 9 pm pre-watershed ban is not the answer to reducing childhood obesity. When considering the option of excluding all HFSS advertising before the9 pm watershed, Ofcom concluded that this would "undermine" its regulatory objectives. Rather than targeting children, it would prevent adults from viewing advertisements for HFSS products that are aimed at them and could make television an unattractive medium for food and drink advertisers.
	According to Ofcom's qualitative research, parents have indicated that they do not favour a ban on HFSS advertising extending to 9 pm. Also, Ofcom considers that the impact on broadcasters would be disproportionate. Ofcom also says that, given the limited impact that advertising has on children's food preferences, excluding the advertising of such foods before the 9 pm watershed would have a minimal effect on obesity levels in contrast to the impact that it will have on broadcasters' revenues and, as such, on the quality of programming.
	It is clearly not rational to introduce yet more changes when the current ones are only now being phased in. What is often forgotten in this depressing debate is the positive power of advertising. At a time when the Department of Health is rightly looking at a public information campaign to educate and inform the public of the dangers of alcohol abuse, why are similar, well thought-out and logical solutions not being proposed in the obesity debate? It is time to end the increasingly hysterical calls for bans, restrictions and bandwagons and to look instead for common sense, clarity and real solutions.

Baroness Thomas of Walliswood: My Lords, I thank the noble Baroness, Lady Thornton, for introducing the Bill and I welcome the noble Lord, Lord Krebs, to our debate and to this House. I am sure that we all look forward to hearing what he has to say.
	I start by saying that I do not represent any interest; I am not an expert even in this field but I am interested in the welfare of children and the effect that health in children has on the general health of a population. I shall speak from that point of view.
	The rate of obesity in children has risen in both boys and girls aged between 12 and 15 so that now 18 per cent—getting on for one in five—are obese. That is the evidence produced for us by the British Heart Foundation, Cancer Research and Diabetes UK. They go on to say that not only has the rate of obesity in children increased "dramatically"—their word, not mine—but that this trend has dangerous implications for the health of these same young people in later life because of the increased risk of cancer, heart disease and diabetes.
	Of course, nobody is suggesting that diet alone can solve the problem of childhood obesity. Exercise is also essential for the health of young people, but that needs to be addressed by other means. That is one area in which I support the speech of the noble Baroness, Lady Buscombe. Meanwhile, we are in danger of raising increasingly obese adults. Today, one in five adults in this country is obese and the fear is that by 2010 that figure will be one in four. An unhealthy diet and excess bodyweight are second only to smoking as risk factors for cancer—risk factors that it is in our power to do something about.
	Similar analyses have been done, with similar conclusions, on the connection between obesity in children and the risk of heart disease and diabetes. The next question is: what has television advertising to do with that? The facts are, first, that children and young people are heavily influenced by television and, secondly, that they do not watch only the TV programmes that are provided especially for them, as research done by Which? clearly indicates. In fact, the programmes most appreciated and watched by children are generally those that are principally aimed at adults. Hence the prohibition of the advertising of fatty, oversalted and oversweet food on television before a new 9 pm watershed proposed in the noble Baroness's Bill.
	It should not be forgotten that, of the children who watch TV at that time, many are of an age to control their own diet —to skip the healthy choices that are offered in schools and to have lunch in the local burger bar and/or to buy crisps, chocolates and sweets on their way home. Addressing the problem of advertising on television will not, by itself, ensure that children are discouraged from eating unhealthy food. We know, for example, that strenuous efforts are being made in schools to offer healthy options at school dinners. However, advertising is a powerful influence on children's choices. If that were notthe case, companies would not spend so much money on it.
	The argument may be made that the advertisers and television companies would lose revenue if this Bill were to become law. Personally, I think that the gain in the health of young people and in the reduction of costs to the National Health Service would be sufficient justification. But we know that suppliers adapt to the market. In future years, organic or local foods may come to have greater importance for food suppliers in sales and market share. To encourage that end, companies will no doubt advertise their new products with the same enthusiasm as they now advertise less desirable ones.
	Why does the regulator not deal with advertising dangerous foods on television if the problem is so serious? That would, in some ways, be the ideal solution. One of the spin-offs from this Bill—even if it does not succeed in getting enacted—could be to convince Ofcom that it has a duty further to regulate these matters in the interests of the health of children and the adults whom they will become. I hope that the noble Baroness's Bill, whatever happens to it, will encourage Ofcom to look again at its policies on advertising fatty, salty or sugary foods before 9 pm.
	The noble Baroness has done children and their parents a real service in bringing this Bill before the House this morning. I hope that she is successful in getting her Second Reading. She has been very precise and quite modest in her claims about the importance of the Bill but, simply by putting it forward, she has raised the prominence of an important issue that affects not only children but also the adults whom they will become.
	The Bill may not survive the parliamentary process on which it has been launched but it will help those parents who are already trying to discourage their children's tendency to prefer salty, sweet or fatty foodstuffs. It will encourage the medical organisations that have warned us of the dangers of these foodstuffs to continue their campaign and it may well encourage Ofcom to go further in the direction proposed by the Bill. That acceptance on the part of Ofcom that it can and should extend the watershed to 9 pm in order to protect children and young people could eventually be the best possible outcome of the noble Baroness's efforts today.

The Lord Bishop of St Albans: My Lords, I join others in thanking the noble Baroness, Lady Thornton, for introducing this important Bill. I also welcome the noble Lord, Lord Krebs, to the House, and look forward very much indeed to his contribution.
	I want to set the Bill in a slightly larger context. Noble Lords may be aware that in late mediaeval society wall paintings in the aisles of churches in western Europe frequently depicted images of a story known as "The Three Living and Three Dead". They showed three beautifully dressed, well fed and haughty young men suddenly being confronted by three rattling, grimacing skeletons with yellow teeth. Emerging from the mouths of those skeletons was the medieval equivalent of a speech bubble, which said, "As you are now, so once were we; as we are now, so you will be". It was, I suppose, an attempt at narrative advertising, designed to remind all those who lived that one day they would die. In the same period, there were also tombs called transi tombs. High-status individuals were portrayed at the top level of the tomb in all their glorious finery and, at the level underneath, were shown gaunt, with the flesh falling off and covered in worms, slugs and toads.
	Both the story of "The Three Living and Three Dead" and the transi tombs were part of a culture in which people were reminded of the dangers of vanity, their own finitude and their accountability to God for their behaviour. Noble Lords may wonder what all this has to do with the Bill. I argue that our society is characterised, at least in much of the media and in advertising, as being obsessed by self. Vanity has become the ruling metaphor of our age and is accompanied by its first cousin, greed.
	I should love to know when the use of the word "consumer" first hit the public airwaves. I guess that it was in the 1950s or 1960s and, ever since, consumption has been a dominant motif in our society. We are constantly urged to consume, and I look to the skills of a 21st century Hogarth or Rowlandson to reveal us in our grossness. I suggest that he would take the image of the British Isles, lift it up somewhere around Hadrian's Wall and show a dustbin full of garbage being emptied into the open mouth of our country. We swallow absolutely everything we can.
	Even worse, we now refer to children as consumers. We do not think of them having their own lives or their own imaginative needs, and, above all, we do not consider their need for places of stillness. Instead, we bombard them in supermarkets and on billboards, the internet and TV with suggestions that what they need is to learn how to consume. "Open your mouth and we will fill it", we say. While this relentless targeting of children goes on, we have, at the same time, developed a terrible but understandable anxiety about children's safety and well-being. The relationship between those two things in our society needs further research. I suggest that we spend much, much more time in society looking at the spiritual needs of children.
	Far from seeing the Bill as the nuclear option, I want to up the anti even more. I should love to seeus following the Swedish example of banning everywhere all advertising with anything aimed at the under-12s. The Wordsworthian child trailed clouds of glory, but the 21st-century child trails crisp packets, designer-label trainers and drink cans. It is a horrible image. Surely, childhood is a place where things ofthe spirit need to be given room to grow, because at that stage children are spiritually delicate. If wedo not enable virtues relating to truth, gentleness, compassion and care for others to take root, we treat them simply as dustbins.
	On a previous occasion, I spoke of us as a society producing fat and greedy children with thin and starving souls, but at least this Bill, which I welcome, is an attempt to ensure that the fat part of that statement is taken seriously. I wish it well.

Lord Krebs: My Lords, it is a great honour to address this House for the first time. I start by thanking the staff your Lordships' House, as well as my fellow Peers, for the warm and helpful welcome that I have received. Some have suggested that my academic background as a zoologist studying the behaviour of animals and as an ecologist acquainted with endangered species will equip me exceptionally well for work in the House! However, today's debate links to my time as chairman of the Food Standards Agency.
	In July 2004, the agency published a wide-ranging action plan for improving children's diets. It included the recommendation to Ofcom and the food industry that the promotion and advertising of food, including soft drinks, to children should reflect a healthy diet. As we have already heard, the National Diet and Nutrition Survey shows that the average child in this country has an unbalanced diet. Put simply, he or she eats too much fat, salt and sugar and not enough fruit and vegetables.
	Again as we have already heard, a poor diet is bad for a child's health, and it contributes to the rapidly rising prevalence of obesity in children. The last Health Survey for England recorded that 25 per cent of children between the ages of 11 and 14 were obese—an increase from 14 per cent a mere 10 years earlier. We know that these children are likely to suffer many health problems in the future, and most of us would agree that we have a duty of care to protect children and support their parents in their responsibility in looking after their kids' diets.
	The Bill introduced by the noble Baroness, Lady Thornton, aims to implement a specific recommendation made by the Food Standards Agency of a nine o'clock watershed for television advertising of foods high in fat, salt and sugar. I want to focus on just one question: how robust is the evidence to support the propositions in the Bill? There are two parts to that question. First, is there evidence that TV advertising affects children's diets and, secondly, is there a proper scientific basis for discriminating between "healthy" and "less healthy" foods? As is often the case in the interface between science and policy, the underpinning science does not provide us with clean, crisp answers, so it is not surprising that there is much heated debate about both issues. That makes it all the more important to stand back and take an impartial view, following the advice of James McNeill Whistler, who famously said:
	"I maintain that two and two would continue to make four, in spite of the whine of the amateur for three, or the cry of the critic for five".
	So does the evidence on the effect of TV advertising add up? As we have heard, children's diets are influenced by many factors and it is hard to separate out their relative importance. But the Food Standards Agency's systematic review of the evidence—the so-called Hastings review—showed that advertising food does have a significant influence on children's diets. It influences not just brand preference (Mars versus KitKat) but diet as a whole—chocolate versus vegetables. That conclusion is now widely accepted by experts in the field. Indeed, the claim that advertising has no effect invites the retort, "Why does the industry spend£300 million a year doing it?". Moreover, since the food industry is in favour of government advertising campaigns to promote positive messages about healthy eating, such as "5 a day", they must surely assume that such promotion and marketing has an effect on children's diets.
	The Hastings review concluded that the direct effect of TV advertising on children's diets may be small. The science is not really precise enough to put numbers on it. But Hastings also concluded that there is a much larger indirect effect of advertising; for instance, through children's classmates or parents. Any parent who has experienced pester power does not need to be further convinced of this. Advertising undermines their attempts to steer their kids towards a healthy diet.
	My second question is whether there is a scientific definition of healthy and less healthy food? In this context, the term "junk food" is often bandied about, but it is not a scientific term and, in my view, it is not helpful. How do you decide, apart from by personal prejudice, what is a junk food and what is not? There is, however, a more objective basis for separating foods into healthy and less healthy, starting from the science of nutrition. The Food Standards Agency has developed a model of nutrient profiles for foods, a way of combining the positive and negative nutritional aspects of a processed composite food, such as a pizza, into a single score. So the nutrients that children tend to eat too much of—fat, sugar and salt—count as negatives, while the nutrients that are underrepresented in children's diets—components such as fruit, vegetables, protein and fibre—are counted as positives. There is no precise formula for combining these components into a single score, so an elementof judgment is involved. Therefore, the resulting categorisation of foods into healthy and less healthy can be no more than an approximation, but it is based on the best available scientific evidence.
	This nutrient profile model has been criticised by some in the food industry because they are surprised that certain products, such as hard cheese, come out as "less healthy". But surely this is putting prejudice before science. It is saying, as perhaps Galileo experienced, "The science is defeating my prejudice; therefore I accept prejudice and reject the science". I, for one, would rather follow a scientific analysis than one based on preconceptions. The Food Standards Agency's model has, as we have heard, been adopted by Ofcom in the restrictions on TV advertising now being introduced.
	The noble Baroness's Bill is based on the proposition that Ofcom's proposals do not go far enough; that they do not strike the right balance between health benefits to children and costs to the advertising and broadcast industries. This is a judgment about the proportionality of regulation. The argument for going further, as we have heard, is that more children watch programmes not covered by the Ofcom restrictions than watch the ones that are covered. A 9 pm watershed, as proposed in the Bill, would capture most of the programmes that children watch. How effective would such a ban be? A recent Australian study, comparing a range of possible measures to tackle childhood obesity, including stomach stapling, concluded that restricting TV advertising of less healthy food and drink to children is the single most cost-effective population-level public health intervention to tackle childhood obesity.
	As the noble Baroness, Lady Buscombe, has pointed out, while the tight restrictions proposed in the Bill are not going to transform our children's diets on their own, they should form part of a wider strategy to change the food culture in this country. We have heard comments about the importance of exercise. Exercise is important, but bear in mind a simple fact: if you go to the gym and run for 30 minutes flat out on the treadmill, step off the treadmill and drink a single can of Coke, you will have put on all the calories that you had burnt off in that 30 minutes. It is difficult to burn off calories by exercise.
	As we have heard, recent opinion polls show that more parents are in favour of a 9 pm watershed than are against it. Some will argue that this is taking the nanny state too far, but the major challenge of childhood obesity will not be solved without significant action by government. What is more, as the noble Baroness, Lady Thomas of Walliswood, has mentioned, there will be a further benefit of tightening the restrictions: they will drive innovation in the food industry. As the chairman of one our largest food companies said to me two years ago, the race is on to create new products that come under the bar in terms of high fat, salt and sugar. The first companies to develop those products will market them furiously to our children and thereby help them to eat a healthier diet.
	If we are to wait and see if Ofcom's measures produce thinner children over the years, we will be waiting for a very long time indeed. I support this Bill. It has a sound scientific basis and it will make a difference to the health of the nation.

Baroness Rendell of Babergh: My Lords, we expected a cogent, thoughtful and penetrating maiden speech from the noble Lord, Lord Krebs, and we have not been disappointed. His is a famous name, and we welcome him to this House. Best known as Sir John Krebs and the former chair of the Food Standards Agency, the noble Lord has a distinguished career behind him as a zoologist, ornithologist and expert in the natural environment. A fellow of the Royal Society and principal of Jesus College, Oxford, he has written more than 250 books and articles on animal behaviour. It is my privilege to congratulate him on a maiden speech which has informed and enlightened us all, and from which I have learnt a great deal about a subject in which I am very interested. It is my misfortune to be obliged to make my speech immediately after his.
	I can recall only very few obese people from when I was young. Extreme fatness was virtually unknown. One very overweight child attended my school and her condition, as we all knew, was not the result of eating unsuitable foods but of an endocrine imbalance: hardly any junk food—I know the noble Lord, Lord Krebs, does not like the term—was available. At that time, there was, of course, no television. It was a curiosity in those days, something to be wondered at. When I was nine I knew just one family who possessed a set. It is hard not to make the connection.
	As my noble friend Lady Thornton has told the House in introducing a much-needed Bill, children are exposed to a huge amount of TV advertising of foods high in fat, salt and sugar, those three nutrition bugbears. Ofcom's research has shown that the vast majority, 82 to 90 per cent, of food and drink advertisements to children are for products highin these substances and that the most popular programmes among two-to-nine year-olds are shown in the early evenings. Perhaps it would not matter if being overweight meant no more than that, but obese children grow into obese adults, of which there are one in five in Britain and the rates are on the increase. It has been estimated that over a quarter of British adults will be obese in three years' time. For the first time in more than a century, average life expectancy may fall, with the prospect that children may live a shorter time than their parents.
	How has this come about? Recent research has shown that, after smoking, an unhealthy diet and excess bodyweight are the most important modifiable risk factors for cancer, something which will come as a surprise to most people who think of obesity as damaging to the cardiovascular system alone. But one third of all cancers are caused by poor diet, obesity and alcohol problems. Some authorities say that the tape measure is a better guide than the scales. Carrying fat around the waist and stomach can quadruple the risk of diabetes and heart disease, for it produces hormones which can be carcinogenic and are linked to breast cancers and bowel and oesophagus cancers. Chemicals produced by excess waistline fat can damage the insulin system, and Diabetes UK has acknowledged that abdominal weight is a contributing factor in type 2 diabetes. Type 2 diabetes, which was once associated with the aged—my grandfather developed it at the age of 80—is now by no means unusual in young and middle-aged adults. Ten years ago it was almost unknown in children, but today there are 1,000 cases in the United Kingdom, all of which are directly due to poor diet and lack of exercise. Diabetic children grow into diabetic adults. Some data link Alzheimer's to obesity. Being fat can also cause children psychological distress; teasing a child about his or her appearance often leads to isolation and low self-esteem.
	Fatty, sweet and salty foods and sweet fizzy drinks seem to have a special appeal for children unless they are never introduced to them or are weaned off them. Exposure to advertising and peer pressure militates against those measures, and children and teenagers are highly influenced by advertising. Yet promotion by the large food outlets could equally be for healthy foods that children like if they are exposed to them very early in life: fruit and vegetables, foods high in fibre and unsweetened fruit juices. Where advertising to children has been restricted, there is demonstrable evidence of the health benefits. In Sweden and Quebec, all broadcast advertising to children under 12 and 13 respectively is prohibited. Sweden has one of the lowest rates of childhood obesity in Europe and Quebec's rate is the lowest in Canada. Research published in the state of Victoria in Australia has found restricting TV advertising to be the most effective way of combating childhood obesity, while the European Association for the Study of Obesity has shown that the United Kingdom has one of the highest prevalence rates for overweight children in Europe.
	When healthy options were offered to children in schools, there were cases of parents bringing junk food to the school gates for their children's lunches. Parents are ultimately responsible for what children eat and drink and are also responsible for what they watch on television. Considering that articles on childhood obesity appear in newspapers virtually every day and proliferate in magazines on sale in supermarkets, and seeing that the Department of Health's website, among many websites highlighting this subject, publishes Why Your Child's Weight Matters, it is remarkable that so many parents seem unaware of which foods are bad for their children and which are beneficial.
	Not only that, but while many people have indicated their support for the Bill, they are often not awarethat their children are overweight. A study published on the British Medical Journal website shows that, of 277 overweight children surveyed, only a quarter of their parents were aware that there was a problem. A team at a Plymouth hospital found that when children were obese a third of mothers and 57 per cent of fathers thought their offspring were "about right". Denial is responsible for a lot of the lack of parental concern, and parents are apparently less likely to recognise obesity in boys than in girls, while adults are unaware of their own weight problems. Just as many of them register a self-enhanced view of themselves when they look in the mirror, their naturally strong bias towards their children makes them see them as slimmer and more attractive than they are. If love is not necessarily blind, it is a powerful beautifier. Parents are far more aware of their daughters reducing themselves to the so-called "size zero" than they are of excess weight. Even now, this may be a legacy from the days when being big or well built meant being sufficiently well fed in a society where being undernourished was the norm. While parents recognise anorexia as a disease, they often dismiss its reverse, obesity, as puppy fat and say that their children will grow out of it. The majority do not, but carry it on into adulthood and for the rest of their lives.
	If the proposal we are discussing today becomes law, as many of us hope it will, and the advertising of unsuitable foods is banned until after the 9 pm watershed, it will be aimed at parents even more than at children, aiming to give them a clear signal of when high-fat advertising starts. Is it time to turn off the television? That is again easier said than done. Moreover, many children now have their own TV sets in their bedrooms, and for them the watershed means very little. Yet some experts are saying that children under three should watch no more than eight hours of television a week, while others recommend none at all for that age group. In the three-to-12 age bracket, television viewing should be less than three hours a day. It is the job of parents to enforce that, which isa responsibility that they find hard given the commercial pressures placed upon their children.
	Cases of obesity, which causes physical damage, are increasing at the rate of 200,000 per year. Speaking as a crank who would like to see junk food disappear from shops, not just from TV, I believe that the Bill, excellent though it is in principle, fails to go far enough. There is no doubt that a complete ban is untenable at this time and is a matter for the future, but in the words of one advertiser's slogan, "Every little helps".

Baroness Coussins: My Lords, I share the concern of the noble Baroness, Lady Thornton, about childhood obesity, but I would urge her to think twice about advocating a measure which falls so short of the established standards of good regulation. Before explaining what I mean, I must declare various interests. First, I am one of the independent members of the Broadcast Council of the Advertising Standards Authority, which has been contracted by Ofcom to adjudicate on all complaints about TV advertising. It is not the job of the council to determine the rules, only to apply them. If a pre-watershed ban on HFSS food advertising were to be adopted, I would of course faithfully apply that rule in my role as adjudicator. Secondly, I am currently a part-time paid independent adviser on corporate responsibility for Mars, some of whose advertising would undoubtedly be affected by the proposals in this Bill. However, I am not seeking to represent that company's views and have not had any discussions with it about this Bill.
	It is in the light of my experience as a commissioner at the Better Regulation Commission, an appointment I held until a few weeks ago, that I would like to concentrate my remarks today. The Government have endorsed the five principles of better regulation identified by the commission. These are proportionality, accountability, consistency, transparency and targeting. The Government have integrated these principles into their guide to regulatory impact assessment. I believe that this Bill falls short in relation to two of those principles in particular, proportionality and targeting. The proportionality principle in simple terms means not using a sledgehammer to crack a nut. All the options available for delivering a policy objective should be considered, from prescriptive legislation through to educational campaigns, to financial incentives, self regulation and even doing nothing. Regulation should be proportionate to the risk and intervention made only when necessary.
	In my view, the evidence to justify a pre-watershed ban is flimsy. A ban would be disproportionate. The Better Regulation Executive scrutinises impact assessments, and it found that Ofcom's assessment on the new TV advertising rules currently being phased in was very thorough and that the consultation undertaken was extensive and comprehensive. It concluded that there was insufficient reason to impose the tougher restrictions proposed by this Bill.
	The noble Baroness, Lady Thornton, relies inpart on recent research from Liverpool University, but this is a study which has not yet even been published in full in the public domain. Its sample was only 59 children. This does not strike me as a robust evidence base. Supporters of the Bill also rely on the research review conducted by Professor Hastingsin 2003. Yet Professor Hastings himself expressed considerable caution and qualification in his review, which found that even the strongest study he could find showed only a 2 per cent direct impact on children's food choices as a result of TV advertising. Furthermore, most of the studies he examined were from North America where there is far more TV advertising and where the same strict rules do not apply. Many of the studies were between 20 and30 years old, while three-quarters of the studies relating to children's behaviour were more than 11 years old. Again, that is not a very robust evidence base, particularly in the wider context of such a rapidly evolving new media technology.
	Ofcom has recently introduced significantly tougher rules. Not only do they impose scheduling restrictions to protect children at times when programmes are targeted at them, they also strengthen the rules on the content of food ads whenever they appear. For example, there is now an obligation on advertisers to avoid anything likely to encourage poor nutritional habits or unhealthy lifestyles in children. In line with better regulation principles, there will be a post-legislative review. An interim review this autumn will be followed by a full-scale review in the autumn of 2008, in which the effectiveness and consequences of the rules, including any unintended consequences, will be assessed. Common sense surely dictates that to change the rules yet again, before the latest restrictions have had time to make an impact or otherwise, is unnecessary.
	I referred just now to unintended consequences, but there is one very much intended consequence of the new rules that I thoroughly endorse. Ofcom said that it hoped that they would provide an incentive to food manufacturers to reformulate existing products, as well as to develop new products which are low in fat, salt and sugar. This is already beginning to happen and I believe that any food producer who wants a sustainable business and a fair regulatory environment will need to be very much quicker off the mark than in the past with innovation of this sort. Turning to the principle of targeting, which I think is being missed by the Bill, the BRC's advice is that regulation should be focused on the problem and that side-effects should be minimised.
	There are claims that a pre-watershed ban is required because 71 per cent of TV watched by children falls outside the conventional hours of children's TV. However, we know from Ofcom's impact assessment that 20 per cent of children's viewing in adult airtime is BBC viewing, where there is no advertising. Secondly, although many programmes most popular with children are adult programmes, the vast majority of people watching those programmes are adults. Between 6 and 9 pm, only 1 in 20 of the total TV audience is a child. One in 25 viewers of "Coronation Street" is a child, and it is one in 26 for "Emmerdale". A pre-watershed ban would therefore effectively be a ban on food advertising to adults, which some may say would be no bad thing, but it is not what is proposed and it is not what has been consulted on. It has not been subject to a regulatory impact assessment and the alternatives have not been analysed. The targeting principle looks even more relevant when the trends in advertising spend and obesity are compared. Since 2003, there has been a decline of 21 per cent in the number of TV food ads seen by children, and a 22 per cent reduction in TV ad spend by the industry. Yet obesity levels among children have continued to rise.
	I agree that obesity is a critical problem. At the same time, though, calorie intake is at or below what it was in 1980, so we are missing something really important if we focus only on the food side of the equation. People now walk 25 per cent less, but watch twice as much television. Only half as many young people now play extra-curricular sport. Obesity has multiple and complex causes and I fully recognise and appreciate that the noble Baroness is under no illusion that her Bill, if made law, would crack the problem on its own. Many other changes in society are needed. For example, healthy eating at home, within the family, must improve. I speak as the daughter of a chef and was brought up to know that eating healthily and eating for pleasure are perfectly compatible activities. It is not only about eating good food, but eating all together at a table and not on your knees in front of the television. All these elements are very important.
	I must also mention school meals. People often talk about the "ticking time bomb" of childhood obesity. In my view, that time bomb began ticking in 1980 when the then government first repealed the statutory duty on local education authorities to provide school meals with minimum nutritional standards. The consequence of that piece of social vandalism was to unleash the lunchbox culture and produce a new-style school meal that rapidly became not chips with everything, but just chips full stop. I know that this is beginning to change back now; I certainly hope so.
	Also on my wish list of what would really make a difference is that the food industry will respond positively to the challenge to innovate and to market its products responsibly, with health and nutrition at the heart of its business strategy. It must exercise some enlightened self-interest for the sake of public health gains and the preservation of commercial freedoms.
	In conclusion, I find myself unable to agree that the measures proposed in this Bill need to be part of the bigger picture. A pre-watershed ban would be disproportionate, hit the wrong target, and distract people from more effective measures. I am very glad indeed, however, to acknowledge the opportunity that the noble Baroness, Lady Thornton, has provided by introducing her Bill to have this debate and thrash out the issues. I hope that it will spur the industry into action, that it will inspire people to eat well and exercise well, and encourage the noble Baroness and her supporters to think again about the regulatory framework, principles and consequences of the Bill's proposals.

Lord Colwyn: My Lords, as a general dental practitioner, I find it always a pleasure to follow the noble Lord, Lord Rea, a respected general medical practitioner. However, I have not received the briefing from the National Farmers' Union.
	I share the concern of the noble Baroness, Lady Thornton, over diet and nutrition and the role that they play in a desirable healthy lifestyle. I support the findings of the British Heart Foundation, Cancer Research UK and Diabetes UK. I agree that foods high in fat, sugar and salt are harmful to health, but I do not share the view that the reappearance of this Bill will achieve any of the noble Baroness's ambitions for changes to the way in which children access foods that still have unacceptable levels of fat, salt or sugar.
	During my dental career, I have offered advice to my patients on nutrition in an attempt to reduce dental decay, promote the health of bone and gums, reduce stress and enable and maintain an efficient and effective immune system. I believe that dentists have an important role to play in nutritional advice to their patients at all age levels and that nutritional screening should be an integral part of the dental check-up.
	Members of my profession have been engaged in discussion with the food and drink industry foras long as I can remember and I recognise its co-operation and attempts over many years to reformulate its products. For example, the industry is working with the Food Standards Agency to reduce salt in bread, breakfast cereals, savoury snacks, soups and sauces and cakes. Effective reductions have been achieved of between 25 per cent and 40 per cent over the past 10 years. I have difficulty with the concept that there are good and bad foods. I prefer to consider good and bad diets, the need for overall dietary advice and advice on a healthy lifestyle.
	As we heard from the noble Lord, Lord Krebs, the principle underpinning current advertising rules for food and the proposed 9 pm watershed ban is the FSA nutrient-profiling model. That model creates a situation where natural products such as cheese, olive oil, honey or even raisins are classified as food that cannot be advertised to a child. The fundamental problem lies in the use of a universal nutrient-profiling model that determines what products can and cannot be advertised on television. The model subverts many nutritious foods eaten by children and serves to discourage investment in the reformulation efforts.
	An additional distortion of the results is introduced by the fact that the model scrutinises products on a 100-gram basis. To emphasise the point made by my noble friend Lord Naseby, the generous portion of Marmite served here by the Refreshment Department between 4 o'clock and 6 o'clock is a good example. It has been banned from being advertised, even though the 100-gram measure is far more than the portion usually consumed, which would, incidentally, pass the nutrient-profiling test. I remind your Lordships that an average family jar of Marmite is 250 grams. Unfortunately, the Bill does not provide a solution to this misconception. On the contrary, it takes it further, taking the same model and applying it to a more radical scenario.
	I am concerned by how a pre-9 pm watershed ban can possibly be justified on health grounds. I want children to cut down on these harmful foods, but I cannot agree that a rule banning advertising before9 pm would work. The Children's Food Campaign, which I usually support, claims that the Bill will,
	"provide clarity on when HFSS food adverts will be shown, allowing parents to exercise responsibility over whether their children see HFSS food adverts or not".
	Are parents being advised to vet advertising content? Let's return to the real world.
	In July 2005, Ofcom concluded that food advertising has a modest 2 per cent direct effect on children's health choice. After undertaking a thorough impact assessment, it also concluded that a television advertising pre-9 pm watershed ban of food and drink to children would be neither proportionate nor effective. As the noble Baroness, Lady Coussins, has said, those figures do not agree with the findings of the Liverpool University research that claims that watching adverts for unhealthy food significantly increases children's consumption rate of such products—more than doubling it in some cases. That research is used in support of the Bill. I do not know who is correct. Perhaps the Government should initiate a broader-based survey than the 59 children whom Liverpool looked at. In the medical world, that survey would be considered anecdotal and not statistically significant.
	When Ofcom considered the efficiency of the measure in relation to its legitimate aim, which is the protection of children, the measure's relative costs and benefits and the absolute costs of the measure to broadcasters, bearing in mind the potential impact on quality and diversity of programming, it concluded that a pre-9 pm ban could result in a £224.4 million loss per annum for broadcasters. That impact on revenue would certainly affect the viability of some channels and programme quality. Some broadcasters might not survive. Having regard to those figures and to the relatively small part that advertising plays in influencing food preferences, Ofcom concluded that such an intervention could not be justified and that the measures suggested in the Bill would not be effective.
	Earlier this year, Ofcom introduced new rules on food and drink advertising on TV, imposing a ban on certain foods in or around children's programmes or programmes that are likely to be of particular appeal to children under the age of 16. In addition to those scheduling restrictions, food and drink manufacturers will no longer use celebrities and licensed characters, promotional offers and health claims in high salt, sugar and fat products advertisements targeted at pre-school or primary school children.
	That is now the situation in non-broadcast advertising, which is covered by new rules published in April 2007 by the self-regulatory Committee of Advertising Practice. Those rules prevent the use of celebrities and licensed characters, promotional offers and health and nutrition claims in all processed food and drink—apart from fresh fruit and vegetables—adverts directly targeted at under-12s. Ofcom committed to undertake a review of the new rules in the autumn of 2008. The Department of Health will later this year conduct an interim review and carry out a full review in 2008 to determine whether the recently adopted rules need reshaping and whether they are attaining the required objectives.
	The new rules, which are among the toughest in the world, should be allowed enough time to bed in so that we can watch how the advertising landscape in the UK changes and then assess its impact on diet. We should remember, though, that Ofcom concluded that advertising has only a modest 2 per cent direct effect on children's food choices. I believe that there should be more research and analysis. The disproportionate and ineffectual measures proposed in the Bill would not address the issue of childhood obesity. We should, however, consider other measures, such as the introduction of home economics into the school curriculum and the promotion of the physical activity and healthy lifestyles that were outlined in the 2004 White Paper Choosing Health and deemed to have a much greater impact on obesity and general lifestyle.

Lord Lipsey: My Lords, I congratulate my noble friend Lady Thornton on allowing us to have this superb debate today. In opposing her Bill, as I do, I want to say from the outset that there is no disagreement in this House about the importance of the issue, the urgency of the crisis and the need for something to be done about it. That is common ground. I therefore wholly relate to the speeches of my noble friend Lord Rea and others, pointing out the dangers of what we face. This is an argument about means, not ends. If the supporters of the Bill can bear to sit through the unpalatable bits of my speech, they may find that there is a twist at the end—I am tempted to say a Rendellian twist—that may be more to their taste.
	Let us start with the evidence. There is plenty of it. Indeed, had I realised that I would have to read through 107 pages of Hastings, 161 pages of annex 7 of Ofcom 2006 and another huge mountain of evidence on top of that, I might well have decided to lose some calories on the golf course rather than detain your Lordships' House. When you read that material, however, you find some important and valuable points that are not necessarily obvious. One is that this is intrinsically a very difficult subject to research, because advertising is a small factor in a social and economic trend to greater consumption of these bad foods. Therefore, it is difficult to disentangle what is due to advertising and what is not.
	It is hard to assess the benefits, because the benefits of getting diet right fall many years hence. Therefore, the assessment is extremely sensitive to the discount rates used on future outcomes and those used because things may change in the mean time. For example, we may find a pill you can pop that deals with obesity. As a result, everybody can interpret the evidence as they want. The Children's Food Campaign, in its briefing to Members, said that there are benefits of up to£1 billion from the changes it wants. That is true. But it would be equally true, using exactly the same sources the campaign uses, to say that the cost of the benefits may be as little as £42 million, another figure included in Ofcom's annexe 7. We cannot say there is firm evidence of the scale of the benefits.
	On my second point, I echo the wise words of the noble Baroness, Lady Coussins. We all pay lip service to the needs of modern regulation. Those include, in the work of the Better Regulation Task Force, that it must be proportionate and targeted. We all sign up to that, except that too often, when it comes to a specific case on something we fancy having regulated, we change our position and say, "In this case, those have to go by the wayside". That is why we have too much pettifogging, nanny-state, ill-conceived, ill-designed and ineffective regulation. We should stick with our principles of regulation, even when they are less than wholly comfortable.
	My third point is about process. Parliament, including this House—I was very involved in the debates on the Communications Act 2003—set up Ofcom which, as I have said, has devoted a mountain of paperwork to considering this subject. I do not think that anyone studying that paperwork could doubt the seriousness with which it has approached this very difficult task. It entirely accepted—and there could be reasons to question this—the Food Standards Agency view of the health and financial benefits that stem from this proposal, and then it came to a judgment, balancing those against costs. It could be said to be a judgment of Solomon; it is a pretty stiff judgment—some have said it is the stiffest of any regime in the world. There is now a ban on advertising this stuff during children's programmes and the BCAP code has been toughened on the things that cannot be done to twist children's minds. That has been set in place; there is to be, as the noble Lord, Lord Colwyn, pointed out, a Government review in 2008 of whether it is working.
	I do not say that Ofcom's judgment is perfect—no judgment is in these matters. But there has to be an immensely strong case before we set aside a procedure, logically based, and based on the decision of this House in the Communications Act, in favour of a sudden rush to something quite different. There is a touch of the dangerous dogs legislation about this: innocent victims—children—and ravening dogs in that case; mastiff McDonald's and the vicious teeth of the food industry in this case, and a press that love to blow up every breath of wind into a gale. It is right that we should consider all those matters but not that we should be blown off course and take action too readily. That is not fully justified by the right kind of investigation which, in my view, is what Ofcom has carried out.
	I come to my twist, and it is this: if it is true—and I am inclined to believe that it is—that this stuff is dangerous, that it is poisoning our children and will damage their future health, why are we talking about the advertising of it? Why are we focusing on that? If there is poison in the shops, you ban it or restrict its sale. My approach is that if, on the evidence, when the Government come to it at the end of 2008, it is clear that the measures that have been taken have not prevented obesity, there has to be a programme of reduction and limits on the fat, sugar and salt content of products. That is regulation, but it would be effective, not ineffective. I should be glad if that could be done in discussion and agreement with the food industry, because I prefer self-regulation intrinsically to imposed regulation, but if it will not agree, we should legislate and enforce. That would make a real impact. This, in my judgment, will not. If a tank is coming towards you, it is much better to equip yourself with a bazooka than a pea-shooter.

Baroness Verma: My Lords, I, too, congratulate the noble Baroness, Lady Thornton, on this important debate. In opposing the Bill, I agree with the noble Lord, Lord Lipsey, on his opening remarks. My interest is as a parent, not as an expert. I declare that I have no interests in any of the food or advertising agencies.
	We find ourselves running around in circles with ideas on how we should be reducing our young people's levels of obesity. Indeed, running could be a good start in answering how to do it. The Bill highlights a real need to question our approach to food and of its added value of nutritional content and the feel-good factor associated with some foods. This must be measured on all consumers, regardless of age. Surely I am not alone in thinking that the most effective way to restore the health of our nation is to engage people in more physical activity and educate them on the impacts of fatty food and the benefits of the healthy nutritional foods.
	Of course children and young people are susceptible to the advertising and market teams—seduction of the consumer is their job. However, ultimately it is our choice whether we buy into that seduction. Surely, the responsibility lies with the parents and carers of children and young people when it comes to what they consume. In placinga pre-watershed ban on advertising certain food products or brands, we would be creating a false and dangerously ignorant bubble around our children and young people, who need to grow up able to judge what is good and bad for them as they will face a world of marketing images throughout their lives.
	Television advertising has been in decline since the start of the decade. Many companies have voluntarily withdrawn their products from being advertising during children's airtime, yet obesity is still on the rise. Losing revenue from television advertising sadly means that less money will be available for good programme-making. Instead, we will receive poor-quality programmes, with less and less invested in home-grown programming.
	We travel down a very dangerous path when we think that banning is the solution to all problems. Where does parental control and responsibility fit into this argument? Surely, as guardians of the health and safety of their children, parents have a role to play. Would we next tell parents that full-fat milk is bad for children, so it must be banned from our television screens, or that cheese and other dairy products are bad, so they must be removed?
	Each day, thousands of portions of fish and chips are sold to the British consumer, thoroughly enjoyed yet never advertised on the television. It is important to have adverts that give consumers choice of lower fat versions of the food we all enjoy. Oven-baked chips are an excellent example—not only are chips a popular food of choice, but these are healthier for you. The pre-watershed ban is proposed on the presumption that people will switch off the TV and remain in a vacuum until the next day. We live in a world of 24-hour access to the internet, mobile phones and technologies that are changing every day. It is impossible fully to control that area of your life. The solution is much easier if it lies in the hands of giving parents back control and ownership of their families. Surely this shows that, apart from damaging UK programming investment, there is no evidence of success in reducing levels of obesity in the British population.
	The measures taken by the industry's regulator, Ofcom, to date, set reductions of up to 50 per cent to the under-10s and 40 per cent to the under-16 age group in certain food advertising. Let us see how that pans out. The food industry has voluntarily responded to the issues on obesity by looking to healthier options and labelling. Parents and carers have the right to be educated on what their children eat, and ultimately it is the parent and carer who will feed that information to their children.
	Schools are stepping up their responses to the problem of junk food and offering better alternatives but, as with all things, they cannot be too prescriptive either, as we cannot always take away from children and young people the enjoyment of the food that they enjoy. Educating and showing real alternatives is what we should be arguing for. We must also get our children and young people much more engaged in physical activities. The hosting of the Olympic Games offers us a huge opportunity to encourage the nation on the benefits of physical activity. We need positive action rather than oppressing the very tools of advertising, which can actually help with the solution.
	The food and advertising industries have great responsibilities and duties to the consumer and it is for us all to encourage them to respond positively to better provision of information and quality of products. It is crucial to ensure that parents and schools face their responsibilities and that healthier options are affordable, as affordability is often a reason why consumers buy junk food.
	In the past 10 years, around 3,000 bans have been introduced under this Government. Can the Government produce evidence to show that these bans have had huge impacts on the lifestyle changes of consumers? Can they show that the number of people with obesity in the population has reduced? I think not. Further controls will prove ineffective and, in my view, unhealthy.

Baroness Howarth of Breckland: My Lords, I congratulate the noble Baroness, Lady Thornton, on introducing a short Bill with such wide implications. The difficulty of being at No. 15 on the speakers' list is that the speech that I originally prepared is probably no longer fit for purpose, so I hope that noble Lords will understand if I stray off the written page and am less lucid than usual. However, the debate is not about the two pages of the Bill but about the future health of our nation. It is about a prevention strategy that reaches out to our children and ensures that they have the best opportunity to lead healthy and fulfilled lives and to grow into fit adults. It is about reducing the stress on our health services by helping people, starting when they are young, to take responsibility for their own well-being but in an environment in which the Government and their agencies, especially the Food Standards Agency, enhanced by the excellent work of NGOs such as the British Heart Foundation, play their part.
	I also congratulate my noble friend Lord Krebs on his maiden speech. In declaring an interest as a former board member of the Food Standards Agency, I pay tribute to the work in which he was engaged as chairman in highlighting nutrition and diet issues and ensuring they are firmly on the national agenda. It was, after all, the FSA that highlighted the effects of the overuse of salt, sugar and fat in foods. Your Lordships will be aware of the successful salt campaign, which was a very positive use of advertising. The agency also commissioned the Hastings review. There were criticisms of the review when it first came to the fore. However, the Food Standards Agency was interested not in proving a point but in having evidence and an outcome of evidence. It therefore listened to the alternatives and set up a number of working groups and fora to test the review's view. At the end, the agency had a number of participants taking part in meetings, one of which was chaired by Professor Nicholas Mackintosh. At that meeting, there was widespread agreement that the Hastings review had the right answer to the question. It is worth knowing that that system had been in place, bearing in mind the criticisms that have been made of the review. It was thoroughly peer-reviewed.
	The Department of Health has also played a vital role in taking the issue forward through its work on reducing obesity and heart disease. The Government's White Paper Choosing Health: Making Healthy Choices Easier, which I think the Minister had in his hand, points out that patterns of behaviour are often set early in life and influence people's health throughout their lives. Infancy, childhood and young adulthood are critical stages in the development of habits that will affect people's health in later years. It is true that healthy eating is only one part of the jigsaw, and that exercise, family eating and all the other examples given by your Lordships are also important.
	Overall, children have fewer opportunities for physical activity, as was well illustrated in the very recent debate highlighted by the Children's Society. Children are more restricted because of heightened concern about the perceived risks of unsupervised play—something I know much about through my work in child protection, although I hope that we are able to reverse that trend. However, as the noble Lord, Lord Whitty, so cogently said, this does not absolve us from dealing with issues of diet and the powerful influence of advertising on children. To fail to take a comprehensive approach will condemn the next generation to a shorter life expectancy than their parents.
	Like the noble Lord, Lord Whitty, I was struck by the fact that the arguments were very similar to those that I heard during the smoking advertising debate and the smoking Bill, in which the noble Lord, Lord Naseby, and I took part on different sides of the argument. We already have evidence from parents that their children have real difficulties in dealing with the promotion of foods. I shall discuss that in greater detail later.
	The arguments do not hold good. The noble Baroness, Lady Buscombe, for whom I have the utmost regard and with whom I have worked on several pieces of children's legislation, had an air of desperation in her voice that I have not heard before. I do not believe that this measure will have the dire consequences for the advertising world that she perceives. Like the noble Lord, Lord Whitty, I believe that its effects will even themselves out.
	The White Paper states that obesity is likely to increase to a huge extent unless we intervene. In the next generation at least one-third of adults, one-fifth of boys and one-third of girls will be obese by 2020, with all the health risks that brings. Does not the Minister agree that restricting the advertising of foods high in sugar, salt and fat to after the nine o' clock watershed would contribute to the Government's own PSA target,
	"to halt the year-on-year rise in obesity among children under 11 by 2010",
	in the context of their broader strategy to tackle obesity in the population as a whole?
	I listened with interest to the noble Baroness, Lady Verma, talking about her experiences as a parent, but her view is not necessarily that of many parents. There is a view that parents must take total responsibility for their children and that they should exercise control over what the latter watch, eat and do. I have talked to parents at the Family and Parenting Institute—which has talked to hundreds of parents—who feel powerless in the face of large corporations, which have so much more opportunity to develop schemes that will get under their children's skin. Its poll revealed that 84 per cent of parents thought that there was too much marketing aimed at children. From their own experience they considered that marketing affected children, shaped and formed their views of themselves and placed parents under pressure to make purchases.
	That pressure is even greater for poorer families. Parents talked of rows with children when faced with saying no continuously. In focus group discussions organised by the institute, parents gave their opinion that the advertising of these foods should be banned entirely and that there should be no marketing at all to under five year-olds. I do not necessarily take that view but parents have expressed it to the institute. Does the Minister agree that the Government should listen to the real experts in this—the many parents who find it difficult to deal with this issue—and do all in their power to support them, as outlined in their own health and Every Child Matters strategies? Would not the noble Baroness's Bill comprise one part of doing that?

Baroness Howarth of Breckland: My Lords, from the very beginning the FSA took a view that this was a highly complex area and that it would engage with any other groups, including the food industry. As the noble Lord, Lord Whitty, pointed out, there have been discussions in a number of areas. I am no longer a member of the board but when I was I understood that the strategy was continually to review this complex area and to look at the issues. There has been much discussion about some issues, including cheese. I love cheese but we must remind ourselves that it is composed of solid fat.

Baroness Jones of Whitchurch: My Lords, it gives me great pleasure to speak in support of the Bill. I add my thanks to my noble friend Lady Thornton for championing this issue so effectively and giving us the chance to debate its merits today. I declare an interest as the deputy chair of the School Food Trust, which has been tasked by government to help improve children's nutrition and tackle obesity by transforming school food.
	Despite welcoming the Bill, it is clear to me that it should not really have been necessary. As we heard, the Government, quite rightly, have already recognised that there is a danger that adverts aimed at children add to their poor eating habits and fuel the growth in childhood obesity. Ofcom was therefore asked to investigate, consult and make recommendations. As my noble friend Lord Whitty persuasively argued, Ofcom then set itself an impossible task of balancing the interests of advertisers against those of the health of children. In trying to find a proportionate response, it has created a fudge that loses sight of the larger moral imperative to protect children from emotional manipulation in making food choices—hence the need for the Bill, which addresses and overcomes the inadequacies of the Ofcom proposals.
	This brings us back to the fundamental question: when can it be justified to intervene in the market and limit broadcast freedom? I must own up to having a lovable but outspoken nephew who is currently studying philosophy and sends me regular e-mails arguing that all censorship is wrong. This is second only to his larger campaign to legalise all drugs. While this appeals to my liberal instincts, I have to face up to the fact that I shall disappoint him once again. While, arguably, adults should be free to exercise their own judgment about health and lifestyle choices, it seems to me that we owe a greater duty of care to children to protect them from exploitation.
	Ofcom itself has already conceded that children have an emotional engagement with adverts for food and that,
	"advertisers are likely to appeal to older children through the use of witty or stylish imagery and subtle messages".
	This is precisely the art of effective advertising; it is what it does. Although we might all despair of all kinds of adverts aimed at children—for example, the marketing of make-up to young girls—the difference here is that there is a real proven link between childhood eating habits, obesity and long-term health problems. It is not something that you can just leave behind as you grow older and become more able to make informed choices. When it comes to food, there are long-term consequences to innocent childhood choices.
	As others reinforced today, the health consequences for young people are shocking and escalating. The BMA estimates that there are around 1 million obese children under 16 and the figure is rising. We have heard the national diet and nutritional survey figures, and I shall not repeat them. We know that poor nutrition has a medically proven link with increased incidence of diabetes, heart disease and cancer. This is a cost to the children in suffering and eventual premature death and to the state in providing ongoing healthcare, which the BMA estimates to be £2 billion a year.
	As my noble friend Lord Whitty pointed out, the nearest equivalent to this debate is that concerning smoking adverts, which took place many years ago. I remember the passions expressed then on both sides of the argument, although, of course, one side was generously funded by the tobacco industry. It was a hard-won argument, but I do not hear many voices today calling for those restraints on cigarette advertising to be reversed, and I believe that the same will be true on this issue. Far from this measure being limited to the bizarre posturing of consumer organisations and health bodies, as the noble Baroness, Lady Buscombe, has alleged, I believe that it will turn out to be a welcome and popular measure with broad support. That view is supported by a recent survey by the British Heart Foundation, which showed that 68 per cent of parents support controls on food advertising before the 9 pm watershed, with only 7 per cent against. That reinforces the case for intervention.
	That brings us to the next issue: do we believe that a Bill of this kind can really make a difference to children's health? The answer has to be that on its own it can make only a small difference, but as part of a wider government strategy to tackle obesity, it can begin to punch above its weight. Ironically, in my experience, the issue of public health, and particularly children's health, is one where the Government have been very effective in working collaboratively across departments. I mentioned earlier that I am the deputy chair of the School Food Trust. We have been given clear targets and timescales by the Department for Education and Skills. These include introducing nutritional standards for school food, increasing the uptake of school meals, reducing diet-based inequalities in childhood and improving children's cooking skills. I say to the noble Lord, Lord Naseby—I am not sure whether he is with us at the moment—

Baroness Jones of Whitchurch: My Lords, I am pleased that the noble Lord welcomes the work that the School Food Trust is doing. However, the trust's existence is necessary only to reverse the deregulation of school meals which was introduced by his Government.
	However, our targets are one part of a much bigger package to improve nutrition and reduce childhood obesity in which, for example, the Department of Health, the Food Standards Agency and the DfES all play a part through the Healthy Schools policy and the Every Child Matters initiatives. Even the Department for Culture, Media and Sport is doing its bit by facilitating extra sports opportunities in schools. It is therefore ironic that the department has so far failed to play its full part in restricting the enticements to bad eating habits among children.
	The key lesson of our involvement in these cross-departmental initiatives is that, to be effective, we need to give clear, simple and consistent health messages to consumers. Unfortunately, the Ofcom compromise fails that test and as a result damages the good work that is going on elsewhere. However, there is another way in which a Bill restricting advertising can make a difference. So far, the debate around the Ofcom proposals assumes that everything remains static; Ofcom places restrictions on food adverts, fewer adverts are produced, and revenues fall. However, as the noble Lord, Lord Krebs, argued quite convincingly, what is more likely to happen is that the food manufacturers will adapt to the new situation, exhibiting creativity and resourcefulness.
	Most big food manufacturers produce a range of healthy and not so healthy foods. For example, Coca-Cola produces a range of sweetened drinks, but it is also busy buying up bottled water companies. Walkers Crisps is now developing oven-baked as well as deep-fried crisps. Many of these companies have the capacity to market healthier food options to children, and those that do not have the ability to diversify if the pressure to do so exists.
	At the School Food Trust, we have seen an excellent example of that. We were asked by the Government to devise new health standards for drinks in school vending machines. We came under considerable pressure from the drinks manufacturers. It was argued that children would not pay for healthy drinks, that the appropriate technology did not exist, that sugar and preservatives were essential for long shelf-life and that introducing those measures would make vending machines uneconomic, losing schools thousands of pounds in income. However, we kept our nerve, and the outcome was very different. New products were developed that met the new criteria, and children's consumption patterns adapted to the new products. The result is profitable machines and healthier children.
	At the same time, there is a growing awareness among adults of the need to eat healthily. Supermarkets have recognised that, and much of their development efforts, revenue and profit growth has come increasingly from the "healthy eating" category, which is among their fastest growing profit areas. That is not just because of pressure from the Government, but because of consumer demand. Manufacturers can take responsibility and show imagination and have the potential to meet the new health challenges; advertisers can do likewise.
	If intervention is necessary, what form should it take? The existing Ofcom proposals fall well short of what is required. Setting a new 8 pm watershed will cause unnecessary confusion, and limiting its application to specific programmes of interest to children, as we have heard that Which? has identified, will exclude the 26 programmes most popular with children and limit its effectiveness. Most importantly, the Ofcom proposals fail to understand that effective public health messages need to be delivered clearly, simply and consistently across government.
	The Bill is a crucial part of the cross-government strategy to fight childhood obesity. As I have already made clear, other departments are playing their part in delivering that strategy. The challenge now is for the Department for Culture, Media and Sport to play its part and recognise its responsibility in that regard. I know that the Minister is a great proponent of joined-up government. If he is serious, I hope that he will take the message back to his colleagues that the Bill has an important role to play in fighting childhood obesity, and that time should be found for it to complete its parliamentary process.

Lord Clement-Jones: My Lords, I congratulate the noble Baroness, Lady Thornton, on instituting such an important debate through her introduction of the Bill. I join other noble Lords in congratulating the noble Lord, Lord Krebs, on his contribution and welcome him to the House.
	I admire the noble Baroness, Lady Thornton; her understanding of retail, consumer and children's issues is undoubted. We on these Benches share her concerns, and have done for considerable time, about the rise of obesity among children and—even more worrying—conditions such as type 2 diabetes and heart disease that follow as a consequence. We also have considerable sympathy with the policy objectives and spirit of the Bill. We do not want advertisingfor food and drink high in fat, sugar and salt that causes obesity in children to be targeted at them, and we want the exposure of children under 16 to it to be reduced. What is the appropriate way of doingthat, and how far should we go? On current evidence and in current circumstances, that is where we part company with the noble Baroness. As the sponsor of the tobacco advertising and sponsorship Bill, I do not see the situation as analogous to that for that Bill.
	The sequence of events leading to the Ofcom proposals of November 2006 and to the Bill is clear. The original Ofcom consultation paper of March 2006 argued for three options. In the end Ofcom, in response to concerns raised, went further and essentially adopted a fourth option—to introduce a total ban on HFSS food and drink advertisements in and around programmes of particular appeal to children under 16. At the same time, Ofcom proposed a ban on the use of celebrities and licensed characters in advertisements in children's programming, and it promised to review the impact of those restrictions a year after implementation, in autumn 2008. Ofcom calculates that its proposals will halve the HFSS food and drink advertising seen by primary school children by 50 per cent and reduce that seen by under-16s by 41 per cent.
	On these Benches in both Houses, we welcomed those proposals as a step in the right direction. We have some reservations, which I shall come to shortly. Our reasons for doing so were and are that Ofcom's judgment about what is proportionate in the context of current research about the impact of advertising, and in the context of the impact of regulation on the television industry, is correct. In the same way that Ofcom has, we need to balance the impact of regulation against the risks that we are trying to guard against. It is estimated that the Ofcom proposals will cost the television industry £39 million. Ofcom, which is the best judge, estimates that the proposals in the Bill would cost some £250 million in lost advertising revenue. As many noble Lords have pointed out, the potential damage to the independent television sector is enormous, and this must be weighed in the balance. I must say that I am not nearly as sanguine on the outcome as the noble Lord, Lord Whitty, or the noble Baronesses, Lady Howarth and Lady Jones. The scale of the change required is enormous.
	Advertising revenue is falling—just look at ITV's recent results—and there will be a knock-on effect. Investment in children's television has fallen by 30 per cent since 1998. ITV has stopped making children's programmes altogether. Noble Lords may have noticed that Philip Pullman criticised much of the non-UK-originated television programming for children. He is absolutely right, but things cannot improve without the necessary revenue.
	The noble Baroness, Lady Thornton, criticised the Ofcom restrictions and wishes to go further, but our knowledge of the impact of advertising on children's dietary preferences is incomplete. As several noble Lords have said, including the noble Lord, Lord Krebs, the FSA assessed that the direct impact was "modest", at 2 per cent. Other research cited in correspondence that I have seen, such as that from Liverpool University, is absolutely not authoritative. Indeed, that research applied to only 59 children.
	Obesity levels continue to rise, particularly among the age group of two to 10 year-olds, yet TV food advertising has fallen by 21 per cent since 2003. Children are watching less television because of other competing media, such as computer games. Therefore, even if we adopted the noble Baroness's proposals, we do not know whether they would be effective. She and other noble Lords complain that many adult television programmes are watched by children and that they will escape the Ofcom restrictions. But the converse argument is that the majority of programmes shown between 6 pm and 9 pm, for which the audience consists of one child for every 19 adults, would have a total ban on HFSS advertisements. Many programmes before the watershed are watched by only a small number of children. Channel Five says that 36 out of its 749 programmes are transmitted before the watershed and fall into the Ofcom category. Yet all those programmes would be hit by a ban. That seems disproportionate to us. Why are the proponents of the Bill so confident that a watershed solution provides the key to children's obesity at a cost of £250 million to the television industry?
	There is a further reason to be wary of these proposals—the restrictions, whether imposed by Ofcom or by this Bill, are tied to the FSA nutrient profiles. Detailed debate on the Bill is for another day, but the system is flawed. As the retail and food industries have pointed out, how can cheese, olive oil, Bovril and Marmite be caught out, but oven chips, diet fizzy drinks and chicken nuggets be okay? The noble Lord, Lord Krebs, pointed out that it is a matter judgment on the science, but many people believe that those judgments are incorrect. The impact of the FSA's nutrient profiles on the type of advertising that could be carried out under the Ofcom proposals would be considerable. If the Bill were to be passed, that flawed system of nutrient profiles would lead to even more perverse conclusions.
	All that said, we on these Benches do not believe that the Ofcom proposals are perfect. In our view, they do not adequately tackle the issue of brand advertising. As the father of a nine year-old, I see that generic brand advertising, as the noble Lord, Lord Naseby, described it, can have a powerful impact. Thus, not every door is bolted in the Ofcom proposals, but I believe that, given the current state of our knowledge, they are proportionate. They represent a principle, as the noble Baroness, Lady Coussins, pointed out in her excellent speech, that Ofcom and other UK retailers must adhere to.
	In future, we must ensure that these restrictions are properly monitored, enforced and, if necessary, changed. A number of reviews will take place that will give us the opportunity to reappraise the situation. We have the Ofcom review in the autumn of 2008, as has already been mentioned; there is the continuing debate in the European Parliament and the Commission about the European television without frontiers directive, which will make recommendations in advertising; the Government will conduct an interim review this autumn on changes to the balance and nature of food advertising and a full review next year; and the Department of Health has commissioned an analysis of advertising and promotional activity, which will help in those two reviews. It seems to me that there are quite enough reviews to give us the opportunity to appraise whether this new Ofcom system is working.
	Of course all of us in this House recognise that there is no quick fix to a major problem such as obesity; many measures need to be taken. As noble Lords have pointed out, many measures were set out three years ago in the White Paper Choosing Health. It is notable that we have not made enough progress in putting those recommendations into effect.
	It is not only with advertising that action needs to be taken; parents, as many noble Lords have pointed out, need to take responsibility for guiding their children towards a healthier and more active lifestyle. I hope, however, that this debate and the Bill's progress will act as a spur, to repeat the expression that several noble Lords have used, to the food industry, the advertising industry, government departments—including the Department of Health and DCMS—and the regulators, to ensure that those restrictions that are currently in place will be effective. We need to be continually vigilant but not just about advertising; we need, as noble Lords have said, to get the substance of our food right and ensure that we do so not just with the way in which we market and sell it but with the products that are out there in the market.

Lord Luke: My Lords, first, I add my congratulations to those offered to the noble Baroness, Lady Thornton, on introducing what has turned out to be a very interesting and worthwhile debate. Secondly, I add my congratulations to those offered to the noble Lord, Lord Kerbs, who made an excellent maiden speech. Mind you, I expected that; I remember the noble Lord, when he was in badger mode, coming to talk about that subject many years ago. He is a very eloquent man. I also want to say something about the speeches of the noble Baronesses, Lady Coussins and Lady Jones, neither of whom I have previously heard speak. I do not necessarily say that I agree with what both of them said but they made jolly impressive speeches and much enhanced this debate.
	The background to this debate is concern over the diet of children and a reported increase in child obesity. My colleagues and I on these Benches, and everyone taking part in this debate, share that concern. Perhaps I might just add that, although "obese" and "obesity" are, strictly speaking, technical terms, it seems unfortunate to label any child in such a pejorative way. I wonder what the effect is on youngsters who are—I am afraid that they are—name-called like this.
	Of course we all want to see healthier children but, if I had the freedom that the noble Baroness has to introduce a Private Member's Bill to promote healthy lifestyles among children, I would not necessarily be treating what is more symptom than cause. My noble friend Lord Naseby and I would be looking to stop the sale of school playing fields. I would be looking to sweep away some of the silly rules that deter schools from taking children on outings. I would be looking to stop some of the obstacles that are put in the way of promoting sport in schools. I would be introducing a Bill to stop the Chancellor diverting lottery money away from sport. I would be applying my time and energy to promoting healthy eating and healthy lifestyles. I would propose, as suggested by my noble friend Lord Colwyn, that there should be a home economics course in all school curriculums. Before introducing yet another ban—how many more bans will be proposed by this illiberal Government?—I would ask whether often it is not so much advertising that promotes unhealthy outcomes as the whole television habit and some programmes that display unattractive and undesirable things that are far more damaging to health than eating the occasional bar of chocolate. To a large extent, it matters only marginally what you eat if you spend 15 hours a week slumped in front of a television.
	Childhood has many gifts and one is a spirit of exploration. There is a natural tendency towards activity and a growing desire to test the bounds of freedom. My own feeling is that, if we are to influence the minds of the young, we do it best by education, inspiration and challenge and not by bans. At the same time, I believe that we should try to inculcate self-discipline in children, both at home and at school. This job is down principally to parents, as mentioned by my noble friend Lord Naseby, but it is also down to the influence of teachers.
	Did the noble Baroness never eat a bar of chocolate as a child? Did her eyes never light up when she was offered one? Did she suffer any lasting damage as a result? Was it advertising that led her to want that chocolate or was it not merely honest, simple, innocent pleasure? If you are to ban advertising, what is the logic for not banning the sale or use in public places of such items? I do not remember one ban or rule from my childhood that a large part of me did not want to try to break, even if I was too much of a wimp to do so. After all, in my experience, what most gets a child wanting a KitKat is not a 5 am advertisement but the sight of another child enjoying one. No ban will do anything about that.
	We should be more positive in our approach to our common aim to promote healthy lifestyles and more far-sighted in our vision and memory of what it is to be a child. Like my noble friend Lady Buscombe, I am concerned at the impact of the Bill on British industry and the creative industries, including the making of television programmes for children. The ITV brief that I received had some troubling arguments on this front.
	We have, indeed, all received well argued and impressive briefs from a number of organisations on both sides of the argument. It is clear that not all the arguments run one way, but one thing shouts out from every brief. We are just starting a major experiment limiting the advertising of junk food during programmes using the FSA nutrient-profiling approach that the noble Baroness enshrines in her Bill. This Ofcom initiative is far-reaching and follows wide discussion. It is to be evaluated by the Government this year and next. Ofcom ruled out a complete pre-watershed ban because that would be disproportionately damaging to the broadcasting industry and it was not widely supported by the public. In fact, the Bill would extend a ban to programmes whose audience, as has been mentioned by several others, is 85 to 90 per cent adult.
	It is said that more than 85 per cent of all confectionery sold is bought by adults and that only a quarter of children under the age of 10 ever buy a soft drink for themselves. Perhaps the advertisers should be targeting the post-9 pm audience and not worrying about the children. Indeed, reductio ad absurdum, perhaps we should consider going back to food rationing. Surely we should respect the careful work done by Ofcom and others. We should see the outcome of the Ofcom experiment before changing the rules again.
	There is far too much chopping and changing of regulation in this country. We will not carry consent with those in the industry and elsewhere who are working with this new initiative if we tear it up before it has scarcely begun. For all the enthusiasm of the anti-confectionery lobby and their good intentions, it should surely be careful not to give the impression that it is not prepared to accept that every action taken by government must be proportionate to the evidence, if the consent that government needs is not to be lost.
	There has already been enough criticism—some of it justified—of the impact of the present rules in banning advertising of Marmite, raisins or cheese, all of which are reasonable components of a healthy, balanced diet. I am particularly interested in what my noble friend Lord Colwyn had to say on this. The Bill would ban the advertising of a range of food products between 5 am—how many six year-olds are on the loose then and, if they are, surely they have bigger problems than chocolate?—and 9 pm. It would put advertising of a chocolate bar on a par with major violence, explicit nudity, graphic sex and repeated violent and foul language. With the greatest respect to the noble Baroness, many people will think that this is frankly ridiculous.
	The solution must be an holistic approach. Better education for children, parents and schools is needed. In addition, the Government should work more closely with the food manufacturers and persuade them that producing healthier food is proactive and therefore profitable. Unilever, for instance, voluntarily does not advertise its fast-food products at all and refuses to use size-zero models in its campaigns. PepsiCo no longer advertises during prime time. Tesco is voluntarily reducing its packaging. Companies are beginning to use corporate social responsibility models efficiently on their own account, as opposed to having social responsibility imposed on them by the state.
	In conclusion, full marks to the noble Baroness for her concern for children, but rather fewer marks, I fear, for timing and method. We should not agree to a Bill to tear up the Ofcom rules before they have even been evaluated and I can therefore not advise my colleagues to support the Bill. If it received a Second Reading, it would need major amendment in Committee, even if it were wise to proceed at all. I urge the noble Baroness, for all her good intentions, to think again and give the Ofcom experiment a chance.

Lord Evans of Temple Guiting: My Lords, I was very impressed by the arguments made by the noble Lord, Lord Clement-Jones. Having sat through the tobacco debate, I do not see the same sort of connection between tobacco advertising and the matter we are discussing.
	Fundamental to this debate is the recognition that there is no single solution. If, on behalf of the Government, I could say one thing, it is that broadcasting bans and so on are part of a solution, not a solution in themselves. That is why the Government have set out a wide-ranging strategy to help create an environment where children and adults can develop key life skills, in particular recognising the importance of activity, physical exercise and a balanced, healthy diet as well as parental influence—a point stressed by a number of Peers. Ultimately, responsibility for diets and lifestyles has to fall to parents and carers, but our role as a Government is to help them to make the right choices for their children.
	A major aspect of the Government's strategy is the obesity PSA, to halt the year-on-year increase in obesity among children under 11 by 2010. The PSA—here we are looking at joined-up government—is owned by the Department of Health, the DfES and DCMS in full recognition that delivery will depend on a solution right across government. There is, therefore, a comprehensive cross-government programme of action to help families lead healthier and more active lives, which includes investing £1.5 billion in school sports in the five years to 2008—we have already made great strides in increasing participation, with 80 per cent of school children now doing at least two hours of school sport a week—up to £500 million funding for better school food, and developing simplified food labelling. There are many other initiatives, a list of which I should be very happy to place in the Library.
	Of course, none of these measures alone will halt the rise in the prevalence of obesity but taken together they will help us improve people's health and afford greater protection to our children.
	As I have detailed, we now have Ofcom's strengthened rules for television food advertising. It is only right that we allow time for these changes and those to non-broadcast advertising to bed in before evaluating their impact.
	As set out in the public health White Paper, the Government are committed to reviewing Ofcom's and other measures, across all media. If these measures fail to produce a change in the nature and balance of food promotion to children—and this is an absolutely crucial point—we will take further action to implement a clearly defined framework for regulation in this area.
	For broadcast advertising, that can be achieved through the existing legislation. I hope that mynoble friend will recognise that, through the Communications Act 2003, the legislative framework is already in place to address the concerns she has raised and to allow for further action to be taken, if needed. Under the Act, Ofcom has the statutory responsibility for setting broadcast standards for advertising and the sponsorship of programmes. In accordance with these duties, it has examined the case and options for greater restrictions and came forward with new rules that significantly strengthen the regulation of broadcast food promotion to schools. However, we will monitor the impact of these measures over the next 12 months. As we have heard, Ofcom will undertake a review in 2008.
	Moreover, the Secretary of State has powers under the Communications Act to issue directions in relation to prohibited categories of advertising. If the Secretary of State was persuaded that the rules were not strong enough, there are, ultimately, powers in the Act which could be used to direct Ofcom. We therefore take the view that a robust and responsive regulatory framework is already in place to address any concerns raised about broadcast food promotion to children, which will enable further action to be taken if this is deemed necessary. Today we have discussed a range of solutions, but, as I have said on at least two occasions, ultimately the responsibility lies with parents.
	We regard the Bill as a valuable contribution to this debate, which reminds us that we cannot afford to be complacent about these significant public health issues. However, we are not convinced that the Bill proposed by the noble Baroness is needed to address concerns about broadcast food promotion to children.

Baroness Thornton: My Lords, I am aware that colleagues who have stayed throughout this debate are probably desperate to get away to their lunch, healthy as I know it will be. However, I need to address one or two points, particularly to the kill-the-Bill-brigade, as I have come to address them in my notes, which was led perhaps by the noble Baroness, Lady Buscombe. We have worked together on child safety issues on several occasions and I confess a disappointment at her stance on this issue.
	If advertising food and drink to children has as little effect as some of those in opposition to this Bill seem to think, why is so much money spent on it and why are they so exercised by it? I also have to say that I fear using the USA is probably not the best example of what might happen. I believe that the attack on the Children's Food Campaign betrays an ignorance of its broader aims on children's health, including that which concerns exercise and food consumption, which is why it has the widest possible support and legitimately seeks support from David Cameron, Gordon Brown and other politicians.
	I slightly took exception to the "let's blame the mother" remarks made by the noble Lord, Lord Naseby, and I am not quite sure how his wife and daughter might feel about that. It takes me back to asking: why advertise to children at all if the mother is always responsible for what the child buys and consumes? The only point on which I agree with the noble Lord is to ignore other media. However, this is a Private Member's Bill and addresses itself to one issue. I can assure and promise the noble Lord that I have my eye on the other media coming down the track.
	I beg to differ with the noble Baroness, Lady Coussins. I believe that politicians have to take responsibility sometimes to help regulators get it right. If the noble Baroness is really concerned about public health, sometimes it is important to listen to scientific evidence. While she is a most skilled regulator and bureaucrat, her proportionality argument here is wrong. This is an emergency which needs a proportionate response. I knew that the noble Lords, Lord Colwyn and Lord Naseby, would raise the "Marmite issue", which the noble Lord, Lord Krebs, addressed quite well. But it is not a reason for not tackling this problem or taking forward and always reviewing the scientific evidence.
	I have to confess that I am disappointed by my noble friend Lord Lipsey, and I shall probably need to see him later. We agree that the FSA and Ofcom route is the right one to take up to the point of decision, but where we disagree is that, clearly, I think that they took the wrong decision. As a parent, I share with many of the points made by the noble Baroness, Lady Verma, but I have to say that I completely failed to take my children out for a nine-mile run after they had consumed a McDonald's burger, which is what they would have needed to remedy the amount of fat taken in. I think that many other parents also fail in that respect.
	I thank the noble Baronesses, Lady Thomas and Lady Howarth, the noble Lords, Lord Krebs and Lord Dykes, and my noble friends Lady Rendell, Lady Jones, Lord Rea and Lord Whitty for their support and wise remarks in adding to this debate.
	Returning to the kill-the-Bill brigade, I do not think that the noble Baroness, Lady Buscombe, has too much to worry about or needs to be quite so vociferous in her remarks since she has the full support of both Front Benches of the House. They are united against the Bill, so I am confident that that means that we have absolutely got it right. To take up just one matter, seeking to justify poisoning our children's minds with a longing for foods that ultimately will poison their bodies by saying that the amount of money available to make decent children's programmes will be reduced indicates that something is seriously wrong with the way we look at our values and our priorities.
	I am a trustee of the Fifteen Foundation and a colleague and admirer of Jamie Oliver. In recent years, he has done more to tackle this issue than almost anyone else. The campaigns he has mounted, along with those of the Children's Food Campaign, reflect a genuine and widespread wish seriously to limit food advertising to children and support parents in their fight for children's health. The Government and this House need to listen to that very carefully, and to take heed.
	On Question, Bill read a second time, and committed to a Committee of the Whole House.

Lord Pearson of Rannoch: My Lords, I beg to move that this Bill be now read a second time. I start by thanking all noble Lords who are to speak today. Other noble Lords who support the Bill but who are unable to speak include the noble Baronesses, Lady Cox and Lady O'Cathain, the noble Lady, Lady Saltoun of Abernethy, the noble Lords, Lord Gilbert, Lord Stevens of Ludgate, Lord Swinfen, Lord Tebbit and Lord Waddington, and the noble Viscount, Lord Trenchard. Noble Lords might also like to know that, somewhat surprisingly, the Bill was also supported enthusiastically this morning on the "Today" programme by no less a personage than the former Labour Minister for Europe, Mr Denis MacShane.
	Students of the history of our ill-fated relationship with the European Union may like to know that a similar Bill was debated on 17 March 2000 and27 June 2003, so four years have passed since we last discussed the desirability of a cost-benefit analysis of our EU membership—four more years of relentless erosion of what was once our proud right to govern ourselves. As before, the Bill does not call for the UK to withdraw from the European Union. It simply calls for an independent inquiry into what life might really be like for our economy, defence and constitution were we to withdraw from the political construct of the EU and continue in free trade and intergovernmental collaboration with our friends on the continent of Europe. The inquiry's findings must be made public by the end of 2008 in time for the next elections to the European Parliament in 2009 and probably for the next general election as well. Supporters of the Bill hope that these findings will at last generate the widespread, informed public debate about our EU membership which the Government say they want, but which in truth they are keen to avoid.
	In the past, the Government have always stonewalled our requests for an inquiry, claiming that the benefits of our EU membership are so wondrous and obvious that it would be a waste of time. I fear we may hear more of that today. The proposed inquiry would give us some unbiased answers to some vital questions. Why do we have this project of European integration? How does it actually work? How far has it got and how does it affect us? How much does it cost? Above all, where is it going, and do we want to be part of it when it gets there? There is widespread public ignorance about all those questions and, in recent months, even noble Lords have approached me after some of our debates with questions along the lines of, "Does it really work like that?".
	So, if your Lordships do not mind, I shall again place on the record the basic answers to the first four questions, leaving the last for the Minister at the end of our debate. Anyone who wants to understand in depth how we got to where we are has to read the enduring masterpiece by Christopher Booker and Richard North, The Great Deception, published by Continuum and now in its second edition. In the debate, I have time only to urge your Lordships to remember that the project of European integration is rooted in one big idea: that the nation states were responsible for the carnage of the two world wars and for the long history of bloodshed in Europe. Those European nation states, with their unreliable democracies, must therefore be emasculated and diluted into a new form of supra-national government run by a commission of wise technocrats.
	This genesis explains why the project works the way it does as the very antithesis of democracy. It explains why the unelected bureaucracy—the Commission—has the monopoly to propose legislation, a function which it carries out in secret. The Commission's legislative proposals are then negotiated, also in secret, by the shadowy Committee of Permanent Representatives or bureaucrats from the member states known as COREPER. This lines up the decisions to be taken officially in the Council of Ministers, still in disgraceful secrecy, where the UK is now reduced to some 8 per cent of the voting power. The Euro-phile EU Parliament naturally collaborates with all extensions of EU law, which is then executed by the Commission. The only arbiter of any debate is the Luxembourg court, which is required by the treaty to find in favour of the ever-closer unions of the peoples of Europe. This it certainly does, often with admirable imagination.
	For good measure, the treaties also ordain that areas of national life taken over by Brussels cannot be returned to national parliaments; the ratchet can only grind in one direction. This is known in Euro-speak as the "Acquis Communautaire", or powers acquired by the community, and it now runs to some 170,000 pages; 100,000 of which have been passed since 1997.
	Yet the heart of our democracy remains, and can only be, the hard-earned privilege of the British people to elect and dismiss those who make their laws. That is Members of the House of Commons, assisted under our constitutional settlement by your Lordships. Millions have died for this principle over hundreds of years, but it has been frittered away in pursuit of the outdated European dream by our political establishment without the people's informed consent.
	I am often asked how an unelected Peer such as myself dares to extol the value of our democracy over the brave new system of Brussels government. The answer is simple and comes in the form of a question: how would you feel if most of our law was proposed in secret by the unelected House of Lords; was processed in secret largely by collaborating bureaucracies; and was then executed by the self same House of Lords? When you put it like that, the penny begins to drop.
	The chilling fact is that a large majority of our national law now comes from the EU. The Government do not want to admit this, of course, and so far have only confessed that a majority of law affecting our business is imposed by Brussels, which is bad enough. But we have it on the authority of the former German President, Roman Herzog, that84 per cent of all German national legislation since 1998 has come from Brussels. On Monday of this week, Le Figaro carried the news that the same applies to 80 per cent of French national legislation. It is hard to see why we should be much different. The House of Commons and your Lordships' House are powerless to reject or amend any of this law, much of which we do not even see. Our representative parliamentary democracy has therefore become largely redundant. We have lost the power to govern ourselves.
	So that is about how we stand now constitutionally. But, of course, this debate takes place under the shadow of the next EU summit on21 and 22 June, when some of the rejected EU constitution is likely to be revived, although it is not yet clear how much. One thing does seem clear, which is that the British people will not be given a referendum on whatever new treaty may emerge from the secret conclaves of Brussels. We will be told that the new arrangement does not alter the relationship between this country and Brussels. That will not be true, of course, but that will not stop them saying it. They will also say that there is no reason to hold a referendum, because referendums were not held on the Amsterdam, Nice or Maastricht treaties, nor on the Single European Act 1986, all of which drained our sovereignty to Brussels but which neither Labour nor Conservative Governments dared to put to the people.
	When you come to think of it, that is a seriously dishonest non sequitur, even by the standards of our modern political class. It is as though you go into the cellar one day and find someone you thought was more or less a friend helping himself to the stored family silver. "Oh," he explains, "I've been stealing it for years and you didn't notice, so I thought it would be all right just to pinch the rest.". Well, it is not all right. What is more, we want all of it back.
	Be that as it will be, I cannot understand why the Eurocrats bother about a new treaty at all. It is not as though they have let a small thing like the French and Dutch rejection of the constitution hold up the creation of their megastate. They told us repeatedly that the enlarged EU could not function without the constitution, but they have been passing legislation25 per cent faster since its rejection. They are putting the constitution in place piecemeal, surreptitiously and illegally, using clauses in the existing treaties that were clearly not designed for the purpose.
	One example is TEC Article 308, which allows Brussels to take power only,
	"in the course of the operation of the Common Market".
	It was in the original Common Market treaty of Rome in 1957, designed to permit small tariff changes and so on. Use of Article 308 also requires unanimity in the Council, so the Government still have the veto but do not dream of using it. It was not designed to allow the corrupt octopus to take power in areas later covered by the 1992 Maastricht Treaty on European union, such as justice and home affairs or foreign policy and defence. Undaunted, however, Brussels has used Article 308 to take control of civil contingencies and of the prevention and aftercare of terrorism, to launch a €235 million propaganda campaign and to set up its new fundamental rights agency in Vienna. The article has also been used to co-ordinate our social security systems, to impose restrictions on the Taliban and to regulate the use of glucose and lactose.
	One does not have to be a legal genius to see that none of those initiatives is justified,
	"in the course of the operation of the Common Market".
	In 1996, however, the Luxembourg Court issued a judgment that sanctions all of them and many more. It did so with breathtaking simplicity, by flatly ignoring the requirement that a new power can only be taken by Brussels if it is necessary in the course of the operation of the Common Market. Instead, the Court agreed that Brussels can take power to do anything that it thinks should have been sanctioned by the treaty but is not. Even then, we are talking about the treaty establishing the European Community, the Common Market treaty, and the initiatives I have mentioned cannot possibly be honestly included in its scope. There is no appeal against the Court's judgments, however. That is the system by which we are now ruled. I submit that you have to be pretty deaf not to hear the jackboots marching, and pretty naïve not to realise that they are coming this way.
	That brings me briefly to our national security and defence. Here, too, the failure of the EU's constitution has done nothing to deflate its military ambitions, which continue to expand in several directions. It has set up a European Defence Agency in which member states pool research, technology and procurement, while the Commission is working on a defence procurement directive. European defence Ministers have also agreed to pool resources to develop a European defence technological and industrial base. They have called for less European dependence on non-European sources for key defence technologies—in other words, Europe must not go on depending on our most valuable ally, the United States of America. Continuing in the anti-US vein, the EU is about to open an EU military planning centre to enable it to plan and run autonomous military operations. NATO and the US have protested about the centre as it will duplicate NATO's well-established military planning staff.
	Like the project of European union itself, much of this is inspired by France's deep psychotic need to bite the hand that freed her in two world wars. But it cannot be wise for us to be part of it to the detriment of our special relationship with Washington. If the Minister disagrees with this analysis—as I fear he will—will he tell us what the Government think France's attitude is now to collaboration with NATO and the United States?
	Finally, I turn to the cost of our EU membership and its effect on our economy. Given our Government's refusal to conduct an official cost-benefit analysis, there have been four private studies in the past five years. These put the annual cost of our EU membership at anything between 4 per cent and 10 per cent of GDP, or between £40 billion and £100 billion per annum. But even the highest of those estimates looks very conservative if we look at some of the official figures which have been published. For instance, the studies of both Commissioner Verheugen and of Her Majesty's Treasury—Global Europe: full-employment Europe—published in October 2005 agree that EU over-regulation costs the economy some 6 per cent of GDP per annum, or £60 billion per annum for the United Kingdom. A Written Answer last Monday gives the net cost of the agricultural policy as£4 billion per annum and the net cash we send to Brussels each year now stands at £6.5 billion, which is likely to double over the next seven years. Those official figures come to a whopping £70 billion, or more than £1,000 per annum for every man, woman and child in the country.
	The Treasury report goes even further, estimating that the common agricultural policy costs EU consumers up to 7 per cent of GDP. The present transatlantic trading barriers cost another 3 per cent. It also suggests that increasing euro-zone competition to US levels could boost output by no less than 12 per cent. Even if we leave this last one out, the Treasury report takes the annual cost of our EU membership to some 16 per cent of GDP, or £160 billion per annum, way above the private studies. No doubt the proposed committee of inquiry will look carefully at all these figures and reach its own conclusions.
	Before leaving the economy, I remind your Lordships that only some 9 per cent of our economy trades with the single market. Some 11 per cent goes to the rest of the world, and 80 per cent stays right here in our domestic economy. Yet the diktats from Brussels strangle the whole 100 per cent of our economy. If we left the political construct of the EU and continued our free trade with it—which of course we would because it trades in surplus with us; we are in fact its largest client—we would not lose any of the 9 per cent which goes to the single market or any of the jobs which depend on it. Set free from Brussels over-regulation and unsuitable foreign trade arrangements, our economy would flourish. In fact, I think it is time to coin a new Euro-sceptic slogan: "Leaving creates jobs—millions of them".
	I come to my final two questions to the Minister. First, does he honestly think that the British people would have voted to stay in what they were assured was just a common market in 1975 if they had known that they would end up where they are today? Secondly, and most importantly, where do the Government think that the project of European union will end? I see three options. First, the octopus may turn into a cuddly teddy bear and decide not to devour any more of our sovereignty. Unlikely, I think. Secondly, the project may overextend itself and fall apart. That would be welcome and probably will happen, but it may take a long time and would be very uncomfortable when it did happen. Thirdly, the project will continue, on track, as it has done in the past, until the EU becomes a totalitarian state. I confess that I fear that this last destination now looks the most likely.
	The inquiry proposed by the Bill would help the British people to decide whether they wanted to stay in an EU which is already very uncomfortable and which may go badly wrong or whether they would prefer to govern themselves again and reclaim their rightful place in the world. I look forward to the Minister's reply and commend the Bill to the House.
	Moved, That the Bill be now read a second time.—(Lord Pearson of Rannoch.)

Baroness Noakes: My Lords, I congratulate the noble Lord, Lord Pearson, whom I still like to regard as my noble friend, on introducing the Bill. I would not normally be in your Lordships' House on a Friday afternoon unless I were required to do duty on the Front Bench, but I am here today, on our Back Benches, because I believe that the issues raised by the Bill are very important and I am pleased to take part in the debate.
	I share many of the noble Lord's frustrations with all that emanates from the European Union. Our membership of the European Union has created and will continue to create many problems for our country, but I am not convinced, as the noble Lord, Lord Pearson, is, that withdrawal is the only solution. We should search for ways in which to make our membership of the EU more flexible and focused on the trading relationships that are beneficial to us and our trading partners. I believe that we should extract our country from those elements that are driving towards a federalist future for Europe and excessive involvement in the daily life of our citizens. We should focus on those elements of our relationships with our European neighbours which are genuinely beneficial to us. That said, the differences between the noble Lord, Lord Pearson, and me on the endgame do not stop me supporting the thrust behind his Bill.
	The Bill requires in effect a regulatory impact assessment of our membership of the EU. We did not carry out one in 1972, when the initial Act supporting our membership was passed, or in 1975, when a referendum was held because in those days we did not do regulatory impact assessments. But even if one had been done, it could not have predicted what has actually happened in terms of our membership. Then we talked about a common market and free-trade issues. Today, free trade is an issue but one thatis more about global than local trade. More importantly, we never imagined how intrusive and costly our involvement with the EU would be.
	The Bill is phrased in terms of withdrawal, and there may be some impact solely related to the process and fact of withdrawal. But the main effects of our membership of the EU, both positive and negative, will be evaluated from the fact of our membership rather than withdrawal. To that extent, this Bill offers a helpful way forward.
	I do not understand why the Government resist the idea of a comprehensive and neutral analysis of the effects of our membership. I had always thought that it was the duty of a Government not just to make new policies but to examine critically whether existing policies continue to deliver value for citizens. I wish that I could detect this quest after the truth in the actions of the current Government.
	As a general principle, the Treasury has been preaching the benefits of cost-benefit analysis for as long as I can remember and there is a well developed framework set out in its Green Book. The framework was designed for new policies and projects but it is quite flexible enough to accommodate the analysis of what happens if we do not carry on doing what we currently do. The Green Book requires an economic, financial, social and environmental analysis and a cost-benefit analysis, which includes items for which the market does not provide a satisfactory measure of economic value. It also gives guidance on the evaluation of social and economic dimensions for which there are no prices, using various other techniques of evaluation. This is exactly what we need for analysing our membership of the EU.
	The Minister will be aware of the fact, to which the noble Lord, Lord Pearson, has already referred, that several cost-benefit analyses have been carried out in recent years. Organisations such as the Institute of Economic Affairs and the National Institute for Economic and Social Research found that at bestthe economic benefit to the UK of continued membership is marginal. But these analyses were undertaken before some major costs were known about. To give just one example, the Financial Services Action Plan will impose costs which some estimate at up to £24 billion over the next three years. More recent studies have found a significant disbenefit from our membership of the EU.
	In the past, Ministers have dismissed such studies, saying that they did not recognise the analysis or that the analysis did not provide a comprehensive answer. That is surely an argument for the Government being fully engaged in the analysis, to tease out the areas of difference and to make a case for those elements that they believe have been ignored. Ministers have similarly been dismissive of the rigorous analysis carried out in Switzerland, which shows conclusively that membership of the EU would not benefit the Swiss economy. Is it not time that the Government started to engage in discussions of the cost and benefits, rather than ignore them?
	Ministers usually say that membership of the EU is good for business and good for employment, and sometimes cite a figure of 3 million or more jobs that are dependent on the EU. There is a belief that we need to be members of the EU in order to trade with it. However, Switzerland is a very clear example of membership not being necessary; the Swiss economy is even more dependent on trade with Europe than our own. Indeed, it is very likely that the rest of the EU needs the UK more for trade than we need it. The balance of trade between the UK and the rest ofthe EU has been negative for some time, and reached a deficit of £32 billion in 2005. For several years, our exports outside the EU have been growing faster than those within the EU, which we should celebrate, because demographic trends show that EU growth is largely static compared with growth practically everywhere else. The EU's long-term trading interests belong outside Europe.
	The costs of EU membership are very great. In simple terms, we paid an average of £3 billion in the 10 years to 2006 through the net cash transfer to the EU budget, but that is set to double by 2011 to nearly £6.5 billion, largely as a result of the Prime Minister's largesse with our rebate. On top of the direct cash flow into the EU coffers, most of our regulatory burdens come out of Brussels and add at least£6 billion a year to the cost of our business sector. That is the Government's estimate; other people's estimate is as high as £20 billion a year. There are also opportunity costs. The noble Lord, Lord Pearson, referred to the Treasury paper Global Europe: Full-Employment Europe, which basically said that the EU was costing anything up to 28 per cent of GDP in protectionism and the opportunity costs of not being competitive. If it is only a fraction of that amount, it is a massive drain on the UK.
	A careful and balanced study could conclude only that the economic costs of our membership currently outweigh the economic benefits of our membership. That leaves the possibility of other benefits, although I have never heard a clear articulation of what those might be and how much value they deliver. In answer to a recent Oral Question from the noble Lord, Lord Pearson, the noble Lord, Lord Davies of Oldham, described the benefits as being,
	"in a wider political context".—[Official Report, 23/5/07;col. 645.]
	When challenged about what that meant, the Minister said that it included such things as,
	"leverage on the Russian Federation".—[Official Report, 23/5/07; col. 647.]
	in relation to energy supplies. I hope that the Minister today will not claim that Britain needs Europe to conduct its relationships with other Governments, because that really would be a very sad admission.
	I conclude by recording one reservation about the Bill: the formation of a committee. The noble Lord, Lord Pearson, will expect me to say this, as I am usually the Opposition's Treasury spokesman. Committees can be very expensive, and can go on for a very long time. They attract large secretariats and produce tons of material. It would be nice to think that the committee specified in the Bill could be streamlined and cost-effective. Perhaps the noble Lord, Lord Pearson, would consider a time limit for its work, and a cost limit on its endeavours.
	I do not doubt the benefit of the analysis proposed in the Bill. It would have my wholehearted support if the noble Lord, Lord Pearson, could find a way of ensuring that the Bill's direct public expenditure implications were indeed modest.

Lord Watson of Richmond: My Lords, having had the pleasure of listening to the noble Lord, Lord Pearson, many times in this House, I retain a sense of wonder at the choice of words and the hyperbolic vocabulary. I noted just seven words in his speech, several of which appeared many times: shadowy, collaborationist, executed, jackboots, conspiracy, mega-state and totalitarian.
	As a Liberal, I know the cost of promoting causes when the times are not propitious. The proposers of the Bill, who clearly believe that the time is propitious for their cause, are in my view quite wrong, inquiry or no. If ever withdrawal was clearly against the British national interest, it is now.
	The Duke of Wellington is famously said to have remarked that interests never lie. Unless we are deceived by ideology and flattery—as, sadly, we appear to have been at a certain point over Iraq—historically the British have been pretty good at discerning where their best interests are. Now they are indeed to stay in the European Union and to increase our influence in it and our commitment to it. Of course, commitment and influence are important bedfellows in this sector.
	I will focus on three reasons why maintaining our membership of and increasing our commitment to and involvement in the European Union are so clearly in our national interest. First, as regards economics, perhaps noble Lords remember the description of the euro as an exotic rain dance, which had no possibility of success. The rain dance has turned into a veritable harvest festival, with the euro being the strongest of the existing currencies.
	For years we were told that the so-called failure of the German economy following the reunification of Germany and the fall of the wall in Berlin was evidence that Europe was not working. Anybody who has observed what has been going on in the largest economy in the European Union will be well aware that the German economy is doing very well: investment in it is increasing, productivity continuously improves and employment prospects are significantly enhanced.
	We have also been told many times that one of the reasons why Europe allegedly does not produce a good return for us is that productivity in the European Union is far outstripped by that in the United States. The latest figures make it quite clear that productivity increases in the European Union are beginning significantly to exceed those in the United States. I take no particular pleasure in that, because we all have a strong interest in the success of the United States economy.
	Enlargement is an enormous success story, not just for the European Union but for the whole free world. The growth rates in central and eastern Europe are one of the most important and interesting factors in the economic scene today.
	What has happened politically? There is a new president in France—Sarkozy—and the very successful Chancellor Merkel in Germany. Although there will, of course, be differences between Merkel and Sarkozy, one thing links them—they are both significantly pro-Atlanticist. I well remember attending an event in London at the beginning of the Iraq war before Angela Merkel became the Chancellor candidate and then Chancellor in Germany. She was asked where she would stand between Europe and the United States. I thought that that was a slightly odd question in the circumstances. She replied without any hesitation and without notes that she had been brought up in formerly communist eastern Germany and never had any doubt at all of the enormous debt that eastern Europe owed to the United States for its resolution and ultimate victory in the Cold War. There is no ambiguity there. Sarkozy has been equally clear about his pro-American attitudes. The days when people could pretend that there was some magical gulf between us with our Atlanticist instincts, which I certainly share, and the continentals, who are hell-bent on trying to create rivalry with the United States, frankly have expired. It is no longer a credible argument. In promoting their cause, those people must think of new arguments.
	Secondly, on the political side, enlargement has crafted a European Union that ideally suits the British national interest. The union that we originally joined—the European Community—was much smaller and was dominated for historical reasons by French-German agreements. There were economic agreements and, perhaps more significantly, there were political agreements. Our ambiguity and our delay meant that our influence was relatively restricted in comparison with that of that central alliance. The same is not true today. In the enlarged European Union of 27 countries, Britain has every opportunity to exert its influence and to create a Europe that is clearly in our national interest. In fact, our opportunity for influence and for real leverage in the European Union is the greatest for a generation.
	There is also in the political debate and argument in the European Union an interesting and important pragmatic tone. I do not want to go into details, because we do not know yet what is going to emerge in the constitutional treaty—or whatever title will be chosen for it—but the approach is pragmatic. The argument in favour of a treaty is practical. It is about making sure that the institutions and the way in which they work can adapt to a membership of 27. It does not make sense that the European Commission should include one member from every member state. It does not make sense that the presidency of the European Council should change every six months. I mention those two issues because they are essentially practical. The effectiveness of shared or pooled sovereignty is real and dramatic, particularly if you compare it with the ineffectiveness of our very unequal special relationship. There is now for Britain a real chance of building the special relationship that can really make a difference in this century—the special relationship between the United States and the European Union, from which Britain has everything to gain.
	The third factor, which may surprise your Lordships, is language. I declare an interest, as I have a long involvement with the English-Speaking Union. Last week, I was in Moldova, a land-locked and somewhat Russian-pressured piece of land in the centre of Europe, where we opened the 12th new English-Speaking Union in eastern Europe in the past 10 years and the 48th worldwide. Why are the Moldovans learning English? The young people to whom I spoke gave two reasons. First, they think that it will facilitate their membership of the global economy and that it is more useful to them in that regard than Russian or any other available language, although they do not wish to give up Romanian, of course. Secondly, they see their future eventually—they are not stupid about it; they are realistic—in joining the European Union and they see English as being a facilitator of that development.
	It is important to note that slightly more than70 per cent of all communication within and between the European institutions, and between them and the rest of the world, is conducted in English. As the working language of the global village, English has become the langue de travail of the European Union. It is an essential bridge. That is a huge advantage for us. I believe that many people in the last 20 years or so have been put off Europe simply by what they perceive to be the linguistic barrier, but that barrier no longer exists. The fact that our language has become the dominant language of the European institutions—I use the adjective advisedly—is a tremendous gift to us and a great enhancement of our influence.
	I share one sentiment with the proposers of this so-called inquiry. They dislike ambiguity; the noble Lord, Lord Pearson, and I have always shared that distrust of ambiguity. I mentioned that last week I was in Moldova. I went to a reception for the new branch of the ESU at our embassy in the capital, and what were the two flags that flew in front of the building? The Minister will not be in the least surprised to know, of course, that one was the European Union flag and the other was our union jack—yet we still have that reluctance, which we have debated in this Chamber a number of times, to display the European Union flag in this country. That sort of ambiguity—that double tonality on Europe between what we do here and what we do abroad—is an own goal. We should maximise our influence, and to do that we need to demonstrate our commitment; our commitment is overwhelmingly in our national interest.
	I shall conclude with a personal reminiscence. In the year before our entry into the European Community, as it then was, I was privileged as a BBC reporter to do an hour-long documentary on Jean Monnet. Incidentally, when I look back at that period, I have to contest the view so often expressed in this House by those opposed to the European Union that, when we joined the European Community, we were simply told that it was a common market and had no political implications. I can talk only from my own journalistic involvement at that time at the BBC, but that is completely untrue. We made the political dimension of membership absolutely clear in programme after programme. I personally did nine hours of broadcasting to that effect.
	When I was doing the documentary with Jean Monnet and staying at his house in Houjarray, I asked him to explain why he and others had not tried harder to persuade the British to become involved in the initial European Coal and Steel Community. He said that the reason was that they understood the roots of British ambiguity—that it was all to do with the fact that the outcome of the Second World War was a profoundly different experience for Britain and the British people from that of countries that had been occupied and defeated. That is clearly so. He said, "The conclusion we drew was that only facts would persuade the British that involvement was in their interests". With every month that goes by, the facts become more and more conclusive. The damage to the British national interest of withdrawal, or even the consideration of withdrawal, would be almost incalculable. We are looking a gift horse in the mouth. We face an open goal; let us not make it an own goal.

Lord Vinson: My Lords, this is a very timely debate. Day after day and week after week, changes are happening to the governance of this country and to our unwritten constitution of which today the British public are not generally aware. At Westminster, there is almost a conspiracy of silence regarding this intensely important issue. I realise that many on the opposite Benches welcome the surreptitious transfer of sovereignty to the EU. Presumably, when they see how inept the present Government are, they welcome any other form of administration. After 10 years of a Labour Government, I am not surprised that they have more confidence in the ability of others to manage our affairs. However, one has to ask why, and at what cost?
	To many of us, the dream of Europe has turned sour. Here in the UK, our infrastructure is a shambles. We look like a third world country in contrast to the ports, roads and airports that one sees when one visits Spain, Portugal and Ireland; many of them have been generously paid for with the help of our money. The noble Lord, Lord Pearson, referred to the billions of pounds that we pay relative to the rebate that we get back. Just think what could be done to our infrastructure—our railways or roads—if we had kept that money and administered it ourselves.
	Even more serious than the direct cost is the hidden cost of the never-ending cascade of EU regulations. The noble Baroness, Lady Noakes, made that point well. Some of those regulations may be helpful but the vast majority are unnecessary. The cumulative effect of those regulations—last year alone, there were more than 2,000—is very damaging, as is reflected in the UK's declining productivity.
	It is all very well to talk about the grand design of Europe but every now and again one has to see how in reality it affects other people's lives. One needs to remember that the macro-economy is the micro-economy writ large. Take, for example, the way in which the working time directive is beginning to affect the management of old people's homes. Sleeping in is now being classified as being on call and that counts as work. Consequently, the housekeeper who worked during the day is now no longer allowed to work overnight. Thus it is deemed that she need no longer be supplied with a flat. So she now has to pay tax on the estimated rental value of that flat and an extra employee has to be taken on to cover nights. That is a huge and wholly unnecessary addition to costs. This type of nonsense has been repeated thousands of times throughout the British economy. Increasingly, we see the damaging effect on drivers' hours, junior doctors' hours and even recruitment to the TA; all are choking on red tape.
	That illustrates how our opt-outs, with regard to the working time directive, are being continually eroded. Rather than helping the British economy, we are now restricting our freedom to create the freeand flexible economy that we need to succeed in the 21st century. The harmonisation of working hours is upon us; tax harmonisation will be next, to be followed by overtime restrictions. Overtime is the essential mechanism in a market economy that helps to bring supply and demand together. Limitations on voluntary overtime would be deeply resisted by the working man, as it is one of the few routes that he has to self-betterment.
	It is through the window of such regulations that the British see the EU, and they do not like it. Not surprisingly, they are disenchanted. The reality is very different from the noble vision that is held by so many in Westminster. I am sorry that the noble Lord, Lord Watson of Richmond, is not in his place. All those ex-Eurocrats who are enjoying the comfort of their pensions should descend from their ivory towers and see the world as it is. The British people hate the impact of this bossy, regulatory approach by which new laws and interdictions endlessly necessitate the employment of new taxpayer-funded officials to enforce them.
	I wonder how many people are aware that you can be fined £5,000 for burning a window envelope, as it is now illegal to burn plastic on an open hearth. You can bury a pet dog but you cannot bury a pet lamb. On the wider national scene, one cannot even deport convicted criminals who came to our country as illegal immigrants. Excessive regulation leaves no room for natural morality and common sense. Those sorts of nonsenses undermine the average citizen's regard for the law, greatly to our national detriment. The more laws there are, the more they get broken.
	As we adopt EU laws, we are, without recognising it, also changing the whole nature of our society. The tangible effects are obvious; the intangible effects are a cause for even greater concern. We take for granted our natural liberties without realising that these stem from common law. Under common law, everything is allowed except that which is not allowed. Roman law—EU law—works the other way round: nothing is allowed except that which is allowed. So, as we harmonise our laws with those of the EU, we are changing the whole relationship of the citizen to the state. The citizen becomes subservient, and civil servants are no longer servants to the public but masters. I give an example. Only last week, the Government announced that pregnant women "must not"—not "should not"—drink because they might overdo it and not drink in moderation. What does this do to the national psyche? It means that gradually our respect for government and the law changes into disrespect. A caring Government become an oppressive Government. We are destroying the Britain that we love and know.
	That is compounded by the underlying weakness of the EU: its democratic deficit. It does not have a democratic structure, and the trappings that exist are largely a sham. There is no electorate to which the major EU institutions are generally responsible, and it is virtually impossible to unscramble bad regulation. The UK carries only 8 per cent of the voting powers, and most change needs unanimity. The undemocratic nature of EU law-making is clearly shown by the fact that our own Westminster scrutiny committee—

Lord Vinson: My Lords, if the noble Lord will give me time to finish my argument—he was not here earlier when I referred to his contribution—I should be delighted to answer. If he listens carefully, I think that he will get his answer. Perhaps I may continue.
	The undemocratic nature of the EU can clearly be shown by the fact that our own Westminster scrutiny committee has passed 157 resolutions from the Lords and 180 resolutions from the Commons seeking change, and every one of them has been overridden. We thus have regulation without rectification—the direct descendant of that which caused the American War of Independence: taxation without representation.
	It is the impotence of EU citizens, faced with no effective way of controlling what the EU does, that has done so much harm and led to the failing support for the EU. They see that micro-management does not work and they cannot do anything about it. I suggest that the chances of reforming it are almost negligible.
	The EU is largely run by an unelected Commission buttressed by unelected judges at the Luxembourg Court. The European Parliament is a consultative assembly, not a Parliament which can decide who the Government should be and whom the electorate can dismiss when it has lost confidence, and the power wielded by the EU machinery of government steadily increases. One has to remember that, sadly, there are many Euro-philes who want to see the disintegration of the nation state.
	It is the job of this House to make it clear that European integration by the back door amounts to a revolution of how our country is governed. If Members of this and the other place want to give our freedoms away in perpetuity, they should at least have the decency to ask the electorate first. I remind them that they got it wrong over the euro—we have done very well outside it—and they will get it even more wrong with further integration. If they say that we should be at the centre of Europe to command it and help it more, I also remind them that being at the heart of Europe when we had the presidency got us absolutely nowhere and proved rather an expensive operation. We should be bringing powers home, not surrendering them.
	We are all concerned about the reform of this House. Far more serious is that there will be very little left for Westminster to do, whether it be the Commons or the House of Lords, unless we face up to the far bigger issue of the transfer of powers to a federalist Europe while we strut about enjoying a residual but fading glory. Indeed, this Government will have completed the job that Guy Fawkes failed to do many years ago.
	The democratic deficit brings with it a crisis for democratic legitimacy when there is no workable framework for making and then unmaking the decisions that affect our daily lives. To quote Professor Siedentop, the recognised authority on these matters:
	"That is why the greatest danger lurking in the process of integration is that democratic political cultures may be weakened in the nation states without being replaced at any other level".
	The ever-falling voter turnout at elections is a clear warning. It is all too easy to forget that democracy is an imperfect glue that holds society together. That glue is fracturing.
	So how can we get out of this mess and put things right? The Government obviously fear a referendum on the EU constitution because they know they would lose. Such a referendum would give a signal that the British people have had enough of integration and we should start substantially repatriating powers. If this seems impossible—I think it will—then we should contemplate withdrawal.
	What would be the consequences of withdrawal? Others in this debate will go into more detail, but I reiterate that Norway remains contentedly outside the common agricultural policy, the common fisheries policy—with its 800,000 tonnes of good fish annually thrown back into the sea—the common foreign and security policy, the common justice and home affairs policy, economic and monetary union and, critically, the EU customs union. We could do likewise and do better. The EU is not the UK's main market; it is not even Germany's main market. The world speaks English when it trades. The EU needs us more than we need it. Even the Institute of Economic and Social Research, in its report Continent Cut Off? says, of the macro-economic consequences of UK withdrawal that,
	"most, if not all, UK jobs involved in exports to the EU would carry on as before".
	Every Gallup poll shows that a majority wish to change the UK's relationship with the EU. This is not an extremist view; it is a majority view. Britain's economy has outperformed those of other major countries, a point so well brought out by the noble Baroness, Lady Noakes. China and India are now the major players. Britain as a major trading nation must be free and flexible to take every advantage, and not to have its hands tied by so much wasteful and stultifying regulation, so damaging to our competitiveness. The repatriation of powers would enable our budget contributions to be employed domestically by cutting taxes and improving public services. Britain could have a wonderful future, but it must be freed from the EU's political and regulatory shackles.
	The EU appears unreformable. We have little to lose and much to gain by returning self-governance to this country, while working closely with our European colleagues and NATO, which has always provided our basic security. The consequences of withdrawal would be overwhelmingly positive. I hope that those who feel otherwise—and they are of course fully justified in airing their views—will support the setting-up of an appropriate committee to examine and report on the implications of withdrawal, as suggested by the noble Lord, Lord Pearson, to whom we are deeply indebted for this debate.
	"the total administrative burden on business, charities and the voluntary sector in England derived from EU legislation is approximately £6.3 billion per annum".—[Official Report, 15/5/07; col. WA23.].
	I would like to know the exact cost, and I hope that the noble Lord, Lord Triesman, will be able to give it when he winds up.

Lord Stoddart of Swindon: My Lords, like other noble Lords, I congratulate the noble Lord, Lord Pearson, on his persistence in bringing this Bill forward. I hope that it will have more success on this occasion than in the past.
	The EU is an organisation to which a country either belongs or not. There is no halfway house. It is essential that there should be periodic examinations of the costs, not only in money terms but across the policy board, and any real benefits that might be obtained. It is absurd that the Government have not acceded to requests for an independent audit of United Kingdom membership of the European Union, so some of us have to try to do something, and the Bill is about the only means available to us.
	First, the costs in money terms have been mentioned, and I want to comment on them further. On 4 June, the noble Lord, Lord Davies of Oldham gave me an Answer to a Written Question about the gross costs that this country pays every year. In 2007, the gross cost is £14.2 billion, and, by 2011, it will have reached £14.5 billion. That is in 2004 money terms, so the actual figures will be much larger than that. Taking into account all the receipts from the European Union—money coming back to us—at 2004 prices, the amount in net terms will increase from £4.7 billion in 2007 to £6.8 billion in 2011. One could reel off a long list of services that would benefit from that sort of money, but it is unfortunately going to subsidise services in other countries, services that are sometimes better than our own.
	The second cost is in trade. I again asked a Question for Written Answer, which was answered by the noble Lord, Lord Davies of Oldham, about the average deficit between 2001 and 2006. His answer was that each year there was a deficit in trade of£27.1 billion. Going in was represented as being essential for our trade, but running a consistent deficit is not helpful. We are not doing very well on trade.
	We have also heard about the cost to industry of regulation. The noble Lord, Lord Pearson, quoted a figure of £60 billion a year. That differs from the figure given to me by the noble Lord, Lord Davies of Oldham, in an Answer to a Written Question. That stated:
	The Government say that the costs are worth while because they allow us to trade freely with the European Union. However, countries outside the EU have trading relations, often better than our own, without incurring the costs that I have just mentioned. They are unnecessary costs and injure our competitive position. We are doubly disadvantaged in world markets. Furthermore, the annual total of some 2,000 laws and regulations from the EU affect all economic activity in this country, yet only 9 per cent of our GDP is involved in European trade. We have to incur huge regulatory costs for only 9 per cent of our GDP.
	It is not simply trade and financial contributions. A Northern Ireland strategy paper indicates that more than two-thirds of administrative and legislative actions originate from or are influenced by decisions taken in Brussels. Huge areas of our national life are being decided not in this country by our own Government and Parliament but by a group of27 countries, of which the UK is only one and in which it has only 8.5 per cent of the voting strength. There is a huge democratic deficit, which the noble Lord, Lord Vinson, mentioned and which the noble Lord, Lord Watson, wishes to close by giving the European Parliament a lot more powers. He has to understand that the more powers that are transferred to the European Parliament, the fewer powers there will be here, and that they will be exercised in an assembly where we have only 78 Members out of a total of some 730. If that is democracy as far as this country is concerned, I do not think much of it.
	I am glad to say that the House of Commons is beginning to notice things. During the past 10 days, the Commons Foreign Affairs Committee has criticised the Government for failing to give timely evidence on the future of Europe, and the Home Affairs Committee has warned the Government not to give up the veto on justice and home affairs without first having a proper parliamentary debate. So the democratic deficit is being noticed not only here but, I am glad to say, in the House of Commons. The Home Affairs Committee is demanding that there should be a proper parliamentary debate before the veto is removed on justice and home affairs.
	The EU's policy is more and more integration. It is demanding more power over taxation and defence; it wants to police our seas and make the resources of the seas community property; it wants to take over much of foreign policy and diplomatic representation; and, of course, it wants a legal personality. That ongoing programme is bound to undermine the democratic Government in this country.
	Those of us who oppose those developments and say that they will completely remove our national sovereignty are often told that we can always repeal the European Communities Act 1972. However, almost in the next breath, we are told that it is inconceivable that Britain should leave the European Union, so they do not think that it is a realistic option at the moment to repeal the 1972 Act. That is why the Government should accept this Bill.
	The Government should understand that it is not only a few malcontents who wish to halt the drive to further EU integration. In a recent poll, 70 per cent of the UK population were against further integration, and 50 per cent wished for a simple free trade organisation. A poll taken by Eurobarometer, which is a European Union thing, found that 40 per cent of those aged between 15 and 30—throughout the European Union, not just in this country—think that the EU means an excess of bureaucracy and a waste of money, and over a third of them see it as a threat to cultural identity and diversity. So there is scepticism not only in this country; it is widespread throughout Europe. People simply are not convinced by the claims made for the success of the EU by the political and bureaucratic elites in the member states. They are deeply suspicious of the constant drive for ever more powers to be ceded to the centralised Brussels institutions.
	We will be told that Britain would be marginalised and ineffective if it was outside the EU, but was that not what was said about ditching the pound and adopting the euro? In 2002, we were told that, if we did not adopt the euro, our country would be marginalised, our economy would stagnate, the City would go into decline, and the pound would be an unstable currency, but that simply has not happened. We are not marginalised. Our economy has performed better than those in the euro-zone and still thrives. The City has grown in strength and influence, and the pound has been a haven of stability.
	The noble Lord, Lord Watson, instanced Germany as a success story within the euro. It is true that, in the past few months, Germany has picked up a bit, but, while we in this country enjoyed a 2.6 per cent increase in GDP from 2002, Germany either stagnated or had a fall in its growth. Unemployment in Germany rose from 4 million to 5.5 million in that period. So we who helped to prevent our going in to the euro did our country a very good turn. I sincerely hope that the future Chancellor of the Exchequer, supported by the future Prime Minister, will see that we never join the euro, because it certainly is not in the interests of this country to do so.
	The proof is there. There is life outside the European Union. That is where the future lies, not in the backwater of Europe. It lies in the wide, wide world—for example, in the Commonwealth. The Commonwealth, which we ought to develop, still represents 25 per cent of world population. The markets of the future will not be in Europe, even though Turkey and one or two other countries might join. The real markets are China, India, the United States and South America. Far from putting all our eggs in the European basket, we should make sure that our eggs are widely distributed throughout the world. Our Britain was built on trading with the whole world. That is our past, and it will be our successful future. Anything else will not succeed. I hope that the Bill makes progress.

The Earl of Liverpool: My Lords, I believe that this Bill is well worthy of support and has much to commend it. It is short and succinct and its objects are clear and unambiguous, as my noble friend explained clearly in his opening remarks. We have been here before. Indeed, rereading the Hansard report of our proceedings on Friday 27 June 2003, one finds the thrust of noble Lords' remarks in favour of the Bill just as relevant today as they were then. Some repetition will therefore be unavoidable, but I shall try to keep it to the minimum.
	One of the great benefits of conducting a cost-benefit analysis would be to place an authoritative stamp on many of the figures that have been doing the rounds of the Chamber today. It is in everyone's interest, Euro-phile and Euro-phobe alike, to do this. No one should have anything to fear from the exercise, and surely we have the right to ask our Government to carry out this research so that balanced judgments can be made. After all, if Switzerland can do it, we can, too. Unfortunately, the Treasury has so far shown no sign of subscribing to this view. It claims that the benefits of EU membership are self-evident and that therefore no detailed analysis of the costs versus the benefits is necessary. I fear that that is a view verging on the delusional; it is certainly not one shared by the majority of the British public.
	Our outgoing Prime Minister will soon be attending the EU summit of European leaders and, as has been said, the prediction is that he will sign this country up to a watered-down EU constitution. Were that to happen, it would be a travesty and make a complete mockery of our democratic process.
	A few weeks ago, ICM Research carried out a survey of the British public for the Centre for Policy Studies, an independent study group. Asked to choose their ideal relationship with the EU, 36 per cent of those surveyed said that the UK should have a looser relationship with Europe and 29 per cent said that the UK should withdraw from the EU altogether. Asked whether there should be a loosening of ties, 69 per cent said yes and just 22 per cent said no. That is fairly conclusive evidence of the views that our public hold on this matter.
	Surely we should heed the words of Professor Willem H Buiter, professor of European political history at the London School of Economics. In a letter to the Financial Times published last Tuesday, he said:
	"Any constitution, be it maxi or mini—and any treaty that involves either a material transfer of sovereignty (in either direction) between the member states and the EU, or a change in the balance of power among individual member states—should continue to be the subject of a referendum, if a referendum was part of the arrangements for the original treaty establishing a constitution for Europe".
	He went on to say:
	"The mini-constitution/treaty revision is likely to be a major constitutional event involving significant transfers of national sovereignty. A British government ... should ask the British people to accept it or reject it in a referendum".
	Can the Minister tell us whether the Government have any intention of heeding those wise words?
	Can the Minister also explain why this Government are so set on tying us into a shrinking marketplace? Europe as a whole is in demographic decline—of that there is no doubt. Projections made by the United Nations population division show that, between 2005 and 2050, EU27 will lose 64 million of its working-age population, while the USA will gain 46 million. That is the equivalent of the EU losing the entire workforce of Germany over a period of45 years. Indeed, the Chancellor's own figures show that the EU's share of global GDP fell from 26 per cent in 1980 to 22 per cent in 2003 and is expected to fall further to just 17 per cent by 2015. On the other side of the coin, the US share is expected to stay roughly the same at around 20 per cent, while India's is expected to rise from 6 per cent to 8 per cent and China's from 13 per cent to 19 per cent. Is any clearer sign needed to show that we are in danger of locking ourselves into an inward-looking and shrinking marketplace? History tells us that that was never our way, as the noble Lord, Lord Stoddart, has reminded us. We have traded on the world stage in the past and we have always sought to trade on a broad front. Indeed, our instinct has always been to look outward, not inward.
	As I am talking about the world at large, I should like to touch on the EU international aid programme. In a report published last April by Open Europe, entitled EU Aid: Is It Effective?, one sees a very sorry picture indeed. While member states have been getting more focused on poverty and have moved away from the old-fashioned use of aid to prop up friendly regimes, the Commission has been moving in exactly the opposite direction and is seeking to use aid as a political lever. While most enlightened countries, including the UK, have been increasing their donations to low-income countries, EU aid to such countries has fallen from 63 per cent to just 32 per cent.
	Regrettably, there are serious problems with fraud. A little over 7 per cent of the EU budget is spent on overseas aid, but OLAF spent 21 per cent of its total time investigating fraud in these areas. So fraud is a far greater problem in overseas aid than in other sectors.
	If the EU is to show that it is serious about overseas development, it must reform the EU's trade policies and farm subsidy programme. A study by Oxford Economic Forecasting found that trade liberalisation and the phasing out of farm subsidies could boost the GDP of sub-Saharan Africa by up to 6 per cent. But, sadly, we delude ourselves if we believe any such reforms are coming any time soon. In the conclusions of the report, one comes to the following damning paragraph:
	"The Commission scores abysmally on policy coherence, it has no monopoly on things like democracy and human rights, any economies of scale in development projects are hard to substantiate, and it is not clear how the Commission's global presence relates to the effectiveness of its aid".
	Time is marching on on this Friday afternoon but, as I mentioned the "F" word—"fraud"—earlier, perhaps your Lordships will forgive me if I add a few more words on that subject to those that have been contributed by other noble Lords. I believe that I am correct in saying that the accountants have refused to sign off the EU accounts for the past 14 or so years because of the level of fraud that they have uncovered. Figures vary, but it is widely believed that the amount misappropriated in this way each year amounts to about £3 billion. The UK's net contribution to the EU is anything from £3.5 billion up to £7 billion and beyond, so, if you use my figure of £3.5 billion, it is possible to argue that some 85 per cent of our taxpayers' money sent to Brussels each year is lost to fraud. To illustrate the point, that represents money disappearing down a black hole at the rate of £400,000 an hour or £8.2 million a day. This is an outrage. But year after year it goes on and, sadly, I see no sign of the situation resolving itself.
	I shall end my remarks by quoting from a speech made by the late lamented Lord Weatherill. As noble Lords will know only too well, he was a past Speaker of another place, a fierce upholder of parliamentary democracy and a supporter of the democratic rights of every citizen in this country. It is indeed sad that he is unable to assist us in our deliberations today. In a short but valuable contribution when we last debated the merits of this Bill just under four years ago, he said:
	"I hope that it is not being too dramatic to say that we are approaching one of the great crossroads of history. It is far easier to lose our freedoms than to regain them".
	He concluded his remarks by saying:
	"As parliamentarians, we have a sacred duty to explain the pros and cons of ever-closer union with Europe. We would be failing in our duty if we did not do that, and we should not be forgiven. It is in that spirit that I support the Bill, which gives the electorate the opportunity to hear the other side of the story from politicians. We should tell them the truth".—[Official Report, 27/6/03; col. 571.]
	I hope that both the Minister and the Government whom he serves will ponder on these wise words and be persuaded that they offer the right and, indeed, the only path to follow.

Lord Willoughby de Broke: My Lords, I am most grateful to my noble friend Lord Pearson for introducing the Bill at such a timely moment. It is timely because the nearly ex-Prime Minister, on the last lap of his world tour, will sign a document in Berlin later this month. It does not really matter whether we call it a treaty or a constitution; the only racing certainty is that it will involve transferring more power away from the nation states, the member states and Parliaments to the European Union and the Commission.
	I am ready to give way to any noble Lord on any Bench who can give me an example of when powers were transferred from the Commission to nation states. I do not know whether the noble Lord, Lord Dykes, who is an experienced European politician, could give me an example. Perhaps he will in his winding-up speech. Has there ever been an example of the Commission transferring powers to the member states rather than the reverse, as has been the historical reality?
	If we are looking at the cost/benefits, the costs are not just financial, as my noble friend Lady Noakes so ably said, but also political, and it is the political aspect which I should like to focus on. The political costs should concern members of all parties and all shades of opinion, whether they are Euro-phile, Euro-sceptic, or among the great "don't knows". It would certainly concern the people of this country if they were told the truth or knew the truth about the political cost of this great construct. They may still touchingly believe that they vote in a democracy, but I am afraid I can demonstrate that it is getting increasingly remote. But perhaps they have understood that, which is why the number of people voting has dropped so significantly in the past few years.
	The transfer of power away from Parliament and the people it represents has been inexorable. The EU has always used the deliberately insidious but highly successful Monnet model—the method of moving ahead by small but incremental movements. It is a political grandmother's footsteps, if you like—what my noble friend Lord Tebbit calls the salami-slicing and I call the Euro-creep method.
	My noble friend Lord Pearson mentioned the former German president, Roman Herzog, and a paper produced by the Germany Ministry of Justice, which came up with the figure that 23,167 legal Acts were adopted in Germany between 1998 and 2004. Of those, 18,917—about 80 per cent therefore—were of EU origin. The former German president said earlier this year in an article in a German newspaper, the Welt am Sonntag, on 14 January:
	"By far the largest part of the current laws in Germany are agreed by the Council of Ministers and not the German parliament ... Therefore the question has to be asked whether Germany can still unreservedly call itself a parliamentary democracy".
	Those are not my words but the words of a distinguished former president of the Republic of Germany. If he says that, surely we should start taking it seriously as well.
	The same supranational laws to which Roman Herzog referred have to be adopted by all 27 member states, including the United Kingdom. The proportion of supranational law will of course vary from country to country. However, it is safe to say that in every EU state, again including ours, something like 60 or 70 per cent of our laws—let us just say the majority; we are not going to argue about precise percentages—now come from Brussels.
	By lucky chance, an interesting research paper was published earlier this week by the legal information research firm, Sweet and Maxwell. The paper showed that 98 per cent of British legislation in the past10 years has been introduced by statutory instrument. This drew the comment from Professor Len Sealy, Professor of Law at Cambridge University, who advises Sweet and Maxwell, that the past 10 years have also seen a massive increase in EU law that becomes UK law without it ever having passed through Parliament, as statute or statutory instrument. Is that not shocking? Professor Sealy pointed out that there were over 2,100 EU regulations in 2006; their scope is astonishing, including cross-border insolvency, importation of bed linen, values of certain fruit and vegetables, the buying-in of butter, evaluation of statistics and labour costs and access of poultry to open-air runs. As he underlined, all became law without our legislators having to lift a finger.
	Let us be absolutely clear: these were laws passed by the Commission and the Council of Ministers and became UK law without being seen by either the other place or this House. To this annual cascade of imposed legislation we must add all the directives, which are transposed into UK law by Parliament—not that Parliament has anything at all to do with the process, except to reach for the rubber stamp. Those include the vehicle end-of-life directive, the landfill directive, the WEEE directive on electrical goods, the drivers' hours directive, the shameful curd cheese regulations, which we passed earlier this year with a rubber stamp, not to mention the 21 directives making up the financial services action plan, which the noble Baroness, Lady Noakes, mentioned and which will be hugely expensive. We do not know the full cost yet—nobody does—but it will be absolutely massive.
	Not a word, not a syllable, not a comma can be changed by our elected Parliament or this House—what some of us were pleased to call the Mother of Parliaments, which is now more the Zimmer of Parliaments. We may amuse ourselves by sounding off about them and passing harmless time discussing these regulations, but it makes no difference. I have to ask: are we really content with this? Are we really content that a majority of our laws are not only untouchable by Parliament but are not even seen by Parliament? Is that what we have come to? If so, why do we need so many highly paid MPs? Never have so few done so little for so much. I dare say that we could also ask why we need so many Peers, given that we cannot touch some 70 per cent of our legislation. What is the point?
	It is clear that the system is not working very well. The EU Select Committees do sterling work—it would sound rather silly if we said "euro work". The noble Lord, Lord Watson, was a member of one of them, as I was until 2000. I know that they do very hard and very thorough work, but their only power is the scrutiny reserve, which I am afraid is routinely overridden—400 times, to be precise, in both Houses since 2001. Ministers' letters are invariably polite and thank the sender so much for that interesting report—"Now, where did I put the wastepaper basket?". Why should it be otherwise, when Parliament has no power? The electorate seem to have got the message—witness the much lower voter turnout—but has Parliament? I am slightly encouraged that members of the Conservative Party, my erstwhile friends, have got around to sniffing the wind. Its Democracy Task Force under Kenneth Clarke has at least thought about strengthening Parliament, but its proposals are really much too timid and do not go nearly far enough to do what should be done to restore some authority to Parliament over EU law. If Parliament is serious about regaining some of the power that has been so arrogantly given away, it should give itself the right to mandate Ministers. Governments would have to have mandates from Parliament on what they can agree to in Brussels. That would be a frightfully good idea, but I can hear the sound of pigs getting ready for take-off.
	Without real power being given back to Parliament, the arguments about the constitution, to which my noble friend Lord Liverpool referred, are irrelevant. It does not really matter whether we have a constitution or what it is called. Dancing around the constitutional maypole in Berlin is simply a quaint folk ritual. The EU will carry on as it has always done. The apparatchiks will continue to use—or abuse, as my noble friend would have it—Article 308 and get into new legislative areas without having the legal basis on which to do so. They will, however, award themselves the legal basis on which to do so. Things will carry on.
	I have a copy of the Commission's work plan for 2007 in my hand. It is illuminating. It is 19 pages of closely typed script, and it covers all sorts of areas: the strategic view of the energy policy; migration initiatives; social reality stocktaking—that should interest Members on the Liberal Democrat Benches, as it certainly would the Commissioners; space policy; the European space programme; defence initiatives; and so on. I can provide noble Lords with the rest of the documents if they are interested. All this means that it does not matter whether we sign the constitution or not; the machine will grind on anyway. That is what has been happening, and it will go on happening; so it does not matter whether we have a constitution or not. The EU has got on very well—or very badly, according to one's point of view—without one.
	This is fundamentally about democracy. MPs should not have given away powers that were only lent to them by the electorate. They were not theirs to give away. No one under 50 in this country has ever had a chance to vote on anything to do with the European Union. The last vote on it was in 1975. They have not had a chance to stop the juggernaut. The real debate, which the noble Lord, Lord Watson, should welcome, is about the facts. This is what the Bill should be about; finding out the facts and determining whether it is right for this country to be swept up in this supranational avalanche of legislation, which affects the whole country but which is unseen, or unamendable, by Parliament. I am not in the business of rubbishing the EU for anyone who wants to be in it. Let us have it, by all means; we will trade with it and have a relationship with it. Other states may be happy to be part of it. I wish them joy of it, I really do. For us, however—this view is widely shared outside the Westminster bubble—the financial and political costs really are too great. I am confident that when the Government have the result of the committee of inquiry, as set out in the Bill, they too will agree that we are better off out.

Lord Moran: My Lords, this House should seek as far as possible to be in tune with public opinion in the country. The more it is, the greater the respect it enjoys and the more influence it has. But on our relationship with Europe neither the Governmentnor we in this House are in harmony with public opinion.
	The Government's enthusiasm for the EU was expressed most recently in the House by the noble Lord, Lord Davies of Oldham, on 23 May, reported at col. 645 of Hansard, and this House is predominantly Euro-phile. People outside take a different view. They are perhaps most exasperated by the continued flow of regulations affecting nearly everything they do. But, increasingly, well informed people recognise the massive disadvantages of our membership—our net contribution, already £3.4 billion a year, which with the surrender of our rebate is set to double before very long; the lamentable CAP and CFP, the latter now described by the responsible commissioner as "morally wrong"; the level of mismanagement and fraud, and the blizzard of new laws and regulations, about which the noble Lord, Lord Willoughby de Broke, spoke so eloquently. Above all, there is the unending pressure forcing us towards a single European state.
	Numerous polls show that two-thirds or three-quarters of the public believe that we should leave the EU, or at any rate have a much less constricting relationship, while only a small minority favour continuing membership. The latest poll I have seen found that 69 per cent would either like to leave the EU or would like a looser relationship with it and that only 27 per cent said that they wanted to remain in it. The majority of our people apparently regard the great benefits claimed by the three major parties as largely illusionary, while they are increasingly aware that our laws are now largely made in Brussels and that what remains of our national sovereignty is being steadily eroded. This disillusion is steadily growing, but it does not seem possible for us to continue to ignore it. It has become clear that withdrawal or loosening up are real options.
	Against this background we ought to know what the real implications of a change of direction are. Therefore, I welcome the Bill of the noble Lord, Lord Pearson. I shall be surprised if he persuades the Government to agree to set up a committee, as proposed in the Bill, but even if he does not it is nevertheless important to bring this question before the House and to test public opinion outside. The noble Lord, Lord Pearson, whose knowledge of the ways of the EU is unrivalled and whose determination and persistence are exemplary, tried this with a very similar Bill four years ago, as has been mentioned. When we gave that Bill a Second Reading I said that we had been advised that there was no authoritative and impartial report on what detachment from the EU, in whole or in part, would mean for the United Kingdom. I said then that I did not suppose that this Government, or any other in sight, would do as we proposed, though, of course, they should, and I suggested that a Select Committee of this House should do so, enabling all of us to judge whether withdrawal would be a catastrophe or bring benefits to this country. Fifty-one Peers, many of considerable distinction, joined in a consequent request to the Liaison Committee, comprised of the great and the good in this House. But, sadly, it turned us down, saying darkly:
	"The establishment of such a committee is likely to be regarded as a negative intervention in the process by this House and we doubt whether it would be possible to isolate the committee's deliberations from wider political consequences".
	The House supported the Liaison Committee, so a good opportunity to give us a solid basis for our deliberations was lost.
	Meanwhile, matters are getting worse. We await the EU summit on the 21st of this month with apprehension. Will it abolish more national vetoes, set up an EU foreign Minister and move towards giving the EU a legal personality, so making it a state?Mr Blair has not consulted Parliament, so we do not know to what he may commit us in the last days of his premiership.
	The power-hungry European Commission forges on. It has just, with the assent of the European Parliament, destroyed the livelihood of our traditional makers and restorers of barometers. It wants to submerge our universities in a European higher education area. It never stops meddling in our affairs. Only very occasionally is there some relief, notably in how Mr Gordon Brown has so far saved us from the euro. Perhaps his imminent succession gives us a ray of hope.
	I do not think that the Government can continue to ignore the views of the British people and condemn us to subjection to a centralised European state that the British people emphatically do not want. Is there no alternative? I believe that there is. We could take a stance similar to those happy and prosperous countries Norway and Switzerland. Then, perhaps, we might cease to be a worried and depressed country and become instead a lively, merry, tough and successful little country. We once were that, in the time of the first Queen Elizabeth. I was recently in the National Portrait Gallery and saw there hanging next to each other the portraits of her three chief advisers, Cecil, Gresham and Walsingham. I felt like saying, "Come back and help us". On our own, we would be much happier and much more prosperous.

Lord Dykes: My Lords, I accept that entirely. I pay tribute to the way in which the noble Lord, as an independent Labour Member, has kept his long-standing traditional views. He sounds like a Tory when he speaks about Europe. I was talking about the Tory party right wing; I was not talking about the party as a whole. Even in the Commons, I assume that there are still some Members of that party who can be characterised as pro-Europe.
	The astonishing thing is that we are told on good authority that ours is the only Parliament of the27 member states in the EU where this existential original debate still goes on, with all those old repeated arguments and discussions from the days when we joined and when that was endorsed in the 1975 referendum. Some Members might wish to say that that is a good thing, but I think that it is rather a pity, because it is living in the past. The nostalgia that the noble Lord, Lord Moran, very movingly expressed—I share many of his views about Queen Elizabeth I and our glorious periods of history subsequent to that—has nothing to do with our membership of the European Union nowadays. One detects some nostalgia for a world that no longer exists. As the global village gets more and more united, with all the countries in the world working together, the EU is just the European logical representation of that process.
	Why do more and more countries want to join? Norway and Switzerland have been mentioned as countries that do not want to take part, but that does not change the central argument. Ten countries joined recently, including the two Mediterranean islands, and subsequently two Eastern European countries came in, making 27. Eighteen of them have ratified the old text of the constitution, let alone what happens with the negotiations for a revised constitutional treaty. It should not be called the constitution; that was always a misnomer. The original document was far too long-winded and boring. It is not just Giscard d'Estaing who should be criticised for those 300 pages but also the noble Lord, Lord Kerr, who was the scribe or secretary to that process. He went along with it; it was a mistake and put people off.
	I rather congratulate the noble Lord, Lord Pearson, on introducing the Bill, although I was not in the House when he introduced his Bill four years ago. I do not know whether he had the Second Reading at an earlier date in the parliamentary calendar then. It seems funny that, as I recall, his Bill was one of the first to be introduced in this Session, yet the Second Reading is taking place on 8 June. I would have thought that he could have easily secured an earlier date for Second Reading, which would have then given us a chance to get the Bill into Committee. When I had my own European Bill—it was somewhat different, being about European flags, town-twinning and so on, and was supported by my noble friend Lord Watson, whom I thank again for that—the noble Lord, Lord Pearson, not only kindly did not press his amendments but did not ask for any vote against the Bill, although normally we do not vote against Bills on Second Reading. I was grateful for that. I would welcome the chance of discussing these matters in Committee, but I fear that that will not now be easy from the point of view of the Bill making any realistic progress.

Lord Dykes: My Lords, the realities of the Commons are different from that very optimistic idea. Be that as it may, we have to be realistic. I hope that noble Lords agree that in reality we are talking about a collection of sovereign countries. In the same way as the United Kingdom has signed treaties all over the world with the different bodies of which we are members—NATO, the United Nations, the WTO—and has defence arrangements in other parts of the world through treaty arrangements, we are talking about a treaty basis for the development of the Union but it just happens to be on a much bigger scale. But where does that scope come from? It comes from the normally collective will of the—yes—sovereign member Governments deciding to do things together. There is no loss of sovereignty intrinsically in that process at all; in fact, each member state gains in sovereignty.
	I hazard a guess, from his appearance, demeanour and manner, that the noble Lord, Lord Pearson, is a member of a number of posh London clubs—perhaps not. Other colleagues here are; I am not very posh but I am a member of a couple of clubs. The principle is that people are members of clubs to gain greater, collective strength from the collective actions of that club and its decisions. We accept that. There is no loss to the individual rights of the member therein; nor is there for any member state in the European Union as a result of agreeing to the European Union treaty and the revised text of the constitution that is about to be negotiated. Eighteen countries have ratified it, so we have to give due respect to fact that the majority of member states presumably want an agreed revised text to facilitate the efficient functioning of the European Union and make it easier for it to move ahead on the collective decisions that it needs to make to increase the individual strength and cohesion of the sovereign member states, including Britain, and the collective strength of the Union.
	The attribution of a legal personality may or may not end up in that text; we do not know. If it does, it does not mean the creation of a superstate—far from it. There has never been any suggestion in recent years from any enthusiastic supporter of the European Union that the sovereignty of the member states is not the key—the fulcrum—of how it functions through all the arrangements. The Commission is now making less legislation. In fact, all too often it is obliged to respond to the member states, making suggestions along the lines of "Study this, look at that, do this". There are far fewer directives, and when they come along they are much more of a broad framework. The noble Lord, Lord Willoughby de Broke, asked for an example of transfers back to the member states. Subsidiarity will presumably be negotiated again in any revised text for the constitutional treaty—I hope so.

Lord Dykes: My Lords, I shall not deal with that because the noble Lord did not answer the points made by my noble friend Lord Watson, and I was referring to something that was said by the noble Lord, Lord Willoughby de Broke. I do not want to take up too much time today.
	The realities of these matters are not at all along the lines enunciated by the Euro-sceptics and anti-Europeans today. The joint article by the Spanish Foreign Minister and the Deputy Prime Minister and Foreign Minister of Luxembourg in the Independent newspaper on 16 January this year states:
	"Europe's challenge at the beginning of the 21st century is firmly to anchor the European integration project"—
	all that that means is sovereign countries working together—
	"in a rapidly changing and complex world. To embark upon this journey we will need both to revive the spirit of the founding fathers, men such as Schuman and Monet,"—
	I only wish that the British had been there at the inception—
	"and to arm ourselves with the necessary means. The [new] Constitutional Treaty is without a doubt, the best tool in our bag. If it did not already exist, we would have to invent it".
	Without it, we will not have the machinery to ensure that the European Union functions efficiently in the future.
	We insisted, as a Conservative Government under Mrs Thatcher, on majority voting to ensure that the single market would work. The bulk of the European Commission's legislation, voted for by the European Parliament and by sovereign member states on an equal basis at the Council of Ministers, was to ensure that majority voting existed to make the single market work properly. The bulk of the current legislation made by the Commission still reflects the gradual, painful and often slow completion of the single market. That process is continuing.
	The British public are very realistic about these matters. Consider the British diaspora in other European countries. Nearly a million British people live in south-east Spain, 600,000 live wholly or partly in France, 55,000 work in Germany, and the diasporas of other countries live in this country, too—in Britain, there is the revered figure of the Polish plumber. All these represent mobile populations who travel around the member states. Why should we have a rigid separation, with Britain standing alone saying, "We are different from all the others"? We can be proud and patriotic Britishers, but we can also be enthusiastic Europeans.
	The President of France, Mr Sarkozy, said that he was worried that the Prime Minister-designate—I am not sure whether that is his official title—might not be sufficiently European and that he might not agree to the extension of qualified majority voting to certain areas, to pass decisions that would undoubtedly very much help this country.
	A noble Lord referred to us as being oppressed and ruled by "jackboot". I share the objections of my noble friend Lord Watson to the use of that obvious reference to Germany. That country became a model of democracy in the period after the nightmare of the Third Reich and the Second World War; we were involved in that process; we worked with the Germans, and they worked with us. I cannot think of a more democratic country, and their English is often better than ours.
	The danger, as suggested in this debate by the "antis"—who are living in the past, old-fashioned and unable to see the modern future—was that we would be outvoted, oppressed and bullied into doing things against our will. We have been outvoted on only two or three occasions in a formal vote, with or without the use of qualified majority voting in the modern sense. Normally, decisions are made unanimously; and that process preserves even more the intrinsic, national and individual sovereignty of each member state. So what is the anxiety all about? I cannot understand it.
	In conclusion, if the Bill makes progress, we can hold further discussions. The Independent newspaper, on Wednesday 21 March, published a long list of50 reasons to "love the EU". All of those reasons concerned practical, home-spun issues such as reducing the cost of mobile telephone calls. That is a good note on which to end my remarks.

Lord Howell of Guildford: My Lords, I think that most noble Lords, perhaps not all of us, have agreed that this debate has raised extremely valid and interesting issues which we have debated often and will certainly return to again. I am only slightly sorry—and I apologise if this sounds a shade partisan—that not a single government Back-Bench Member has attended this debate. I know that these matters are not important to them on a Friday afternoon, but actually they are important, even on a Friday afternoon. I had to get that crack in before I move on to more neutral and non-partisan observations.
	As for the Bill and the promotion of it by the noble Lord, Lord Pearson of Rannoch, I doubt whether these issues, important as they are, can be encased in a legislative instrument or, heaven preserve us, yet another committee. That is reflected rather well in the obvious problems in Clause 1(3), in which the noble Lord, Lord Pearson, makes heroic efforts to define how on Earth one would construct an independent committee on a subject of such vast extent and where there are such strong and polarised opinions, which the noble Lord, Lord Monson, bravely tried to modify. Frankly, I cannot for a moment see that part of the exercise succeeding but I suspect that that was not the Bill's main purpose anyway.
	I am left wondering whether I would fit into any of the categories. I do not fit into the wonderful, old-style view of the noble Lord, Lord Dykes, of left and right and that sort of thing in the Tory party; we do not live in that world any more. I am not at all sure whether I am left or right. Nor am I at all sure where I fit into the categories of the noble Lord, Lord Pearson. I personally believe that Britain should play a leading part in Europe in a union—not the Union that we have today but a revised one. I do not know where that puts me on his committee; it probably keeps me off it altogether.
	If one is calm and sensible, one will see that the issues are vastly important—they are vital—and are much too pervasive and complex to be locked away in any committee. My noble friend Lady Noakes rightly said that we must give the most profound attention to them. The Government's handling of them is far from satisfactory; we need a much better approach all round.
	The debate has raised four key areas for attention: the UK economy and the EU; our national security and defence; our law and constitution; and our budgetary and public spending policies. Let me go through those. On the economy, almost everyone—maybe not one or two who have participated in this debate—accepts that our economy is now hopelessly overloaded with regulations; very much so for our smaller businesses. The costs of compliance with regulations are rocketing; the estimate is that since 1997, the costs to British business have risen by£55 billion, of which three-quarters or more are of EU origin. I am told that the EU working time regulations alone cost £1.8 billion every year; that sum is probably rising.
	The whole process of incorporating EU regulations and other burdens into our lives is sloppy, full of holes and should long since have been tightened up. Whether one can blame one Government or another, we have allowed a wholly inadequate and almost insultingly casual process to develop. As the noble Lord, Lord Willoughby, pointed out, we are governed increasingly not merely by secondary legislation and statutory instruments that slip through but by instruments and legislative devices that do not even pass through Parliament or which do so without touching the walls either side. I am personally coming to the view—I first put it forward with my colleagues in another place more than10 years ago—that we must follow the Swedish and Danish example. We must ensure that our Ministers are controlled by mandatory concession, by mandatory agreement, by our two Houses of Parliament before they agree to things in the Council of Ministers. I know that that sounds like a big step forward but if we—the Government or my own party—seriously believe that we will have more open, effective and democratic government in our own country, we may have to go the way of the Danes and the Swedes in that regard.

Lord Howell of Guildford: No, my Lords. The noble Lord should certainly not think that everything that Conservatives say is agreed policy because we are not yet in government. We are formulating and thinking about these things. I shall have a thing or two to say about his party's rather strange policy on these matters in a moment. The noble Lord can take it that we are seriously thinking about better ways in which to control this flood of instruments and legislation and to bring before Parliament and the people certain decisions before they gel or are formed in concrete and it is too late to change them. I believe that this may be one way of doing it, but I shall not go further than that at the moment.
	The second matter—national security and defence—raises even deeper issues on which, frankly, we are not being kept up to date in either Parliament. Our fear continues to be that NATO is being damaged by EU military aspirations and duplication. On the soft-power side of security and defence, there is the development aid issue, which is not mentioned in the Bill of the noble Lord, Lord Pearson. As my noble friend Lord Liverpool rightly said, it is common knowledge that the EU aid processes are bureaucratic and inefficient and that they fail totally to focus on the lowest-income countries. There really is a case for urgent review in that regard and for reclaiming our national aid and development policies, given the general sense of failure and betrayal from all the high-flown promises for Africa at Gleneagles and elsewhere and at various EU summits.
	The Bill does not say anything about the latest EU passion for binding targets on the climate and global temperatures—targets which will not bind anyone in the end and will distract us from many more practical measures to upgrade our environment. Nor does it say anything about energy, which we will no doubt debate further in the future. I forget which of my noble friends mentioned it but the EU continental system declares that it wants to reduce dependence on Russian gas. In fact, there will be a vast increase in dependence on Russian gas, and we should be very careful not to become caught up in the extremely vulnerable systems that will then emerge. We need to look for other ways of ensuring our energy security.
	Then we come to the third issue: the constitution. On that, our position is clear, which is more than can be said for that of the Government. We say, quite simply, that a new transfer of powers from the UK to the EU should be subject to a referendum. That is what the Government used to say as well, but now they have reneged on that and I do not think that the British people will take kindly to this particular U-turn.
	We obviously need to keep a special eye on criminal law powers, labour relations and, above all, foreign policy, but keeping a special eye is extremely difficult because, as the noble Lord, Lord Monson, and others said, we are being kept in the pitch dark about what is going on. Even the Foreign Secretary will not tell the House of Commons Select Committee what our approach is to be at the meeting in a few days' time to determine the whole pattern of constitutional reform. We know what Mrs Merkel in Berlin wants; we know what Mr Sarkozy in Paris wants; we have a pretty shrewd idea of what the British people want, if they are allowed a say; but we have no idea what the Government want. Frankly, that is disgraceful and a total snub for all the talk about open government and transparency which so fills official rhetoric.
	Then we come to the subject of hard budgetary economics, which I think is the main interest of the noble Lord, Lord Pearson, who has produced a great many papers and done a great deal of work in this area. Under the current less-than-brilliant budgetary deal secured by UK Ministers, the UK will raise its net—I repeat "net"—payment to the EU annually by £2.5 billion to £6 billion over the period from 2006 to 2013. This compares—it is a comparison near to my heart—with around £40 million a year which the British Government pay to support the Commonwealth. The disparity—at a ratio of about 100:1 or 150:1—is so vast that it makes one pause when one thinks that the Commonwealth network is probably more valuable in terms of British influence than anything that the EU can offer today. The contrast really should make policy makers pause, and make the dear old Foreign and Commonwealth Office remember the second and third words in its title—and Commonwealth. Until there is more evidence of that, we shall not regain the balance in British foreign policy that we have so tragically lost over the past 10 years.
	By contrast, along the way, the EU's administrative costs alone involve more than£4 billion a year, and that is now set to rise by a further 20 per cent. We also know that the UK will be paying 20 per cent more to the EU budget than France and get back less EU money per head than any other of the EU's 27 members. These are matters about which we must pause and think very hard indeed. Even if setting up a new committee, with a feverish, almost snark-like search for independence, is going to do the job, those are nevertheless matters on which we should remain intensely focused at all times, particularly in the coming weeks and months.
	There are all sorts of other profound issues about the EU situation and the current trends that we obviously need to discuss. In fact, we will be returning to the constitution issue next Thursday on a Liberal Democrat Motion. That is perfectly acceptable, and we will no doubt deal with it thoroughly. However, I find the Liberal Democrats' wish that the UK can be defeated in the coming negotiations—that England should be defeated, to use their words—leaves a very unpleasant taste indeed. I hope that we will hear no more of that in the coming debate.
	However, as well as doubting the efficacy of a Bill or a committee on such momentous matters, we in this party do not favour a withdrawal strategy at all. We see that as defeatist. Obviously the EU's nature will be transformed. The noble Lord, Lord Watson, mentioned Moldova. Turkey is in the wings along with Ukraine and Georgia; and even countries beyond Georgia, including Azerbaijan, are seeking to join a wider European—by then it will be Eurasian—Union. That transformation is going on slowly but all the time. Secondly, the people of Europe at the grass roots are beginning to speak. Until the referendum defeats of a couple of years ago, one could say that they had never spoken yet, but then they did speak. It was not the people of Britain—who got such stick from the noble Lord, Lord Dykes, as though we were the only offenders—but the people of the Netherlands and the people of France who spoke out and said they did not wish any further centralism and that the whole doctrine of bigger, larger and more remote blocs and more remote systems of government, undermining people's identity, closeness and intimacy, was one that they rejected. They were the people who spoke out.
	We favour vigorous and extensive EU reform and the confining of EU activities and ambitions to sensible, reasonable goals which we can achieve by working together with our neighbours, as good Europeans, as we always will be and always have been. Today, the EU has its place—its local place—but there are much wider worlds to conquer, and by whom we may be conquered if we do not look out.

Lord Howell of Guildford: My Lords, the noble Lord is presuming a lot, and perhaps some of the people in those two Governments are presuming. There remains a very strong wish throughout Europe for matters involving the further transfer of powers—particularly when those powers are transferred away rather than nearer to the people—to be subject to referendums. That is the wish in this country. That is the wish among many Frenchmen and the wish of many of my German friends. For Governments anywhere—though I speak for none, because I am a member of no Government—to ignore that or cavalierly to assert to the contrary that Europe is fine, everything is fine and we should stop worrying, is a dangerous path indeed. I think that those who hold that view will live to regret it.

Lord Triesman: My Lords, that is an entirely fair point. Of course I am not saying that. However, as you watch the economies and the internal performance of the economies of every nation that has joined the EU, you see that they have taken a step-change leap up in trade arrangements and the value of their exports. It is extremely hard to imagine that this could have happened outside the stability of the arrangements that have been achieved in Europe.
	In response to the noble Earl, Lord Liverpool, I entirely understand the point about other markets, but I cannot see that these matters are mutually exclusive. I observe, as he does, that other markets are growing, but we should be careful not to conflate arguments about the proportion of trade with the absolute figures on trade. Part of the reason why the proportions are changing is that China, India and others are growing massively as economies and present us with new opportunities, but that is not an argument for being outside our trading arrangements now.
	Membership of the EU is also important to the United Kingdom when negotiating external trade agreements around the world, because of the power of the world's largest trading bloc. It is a driving force in the launch of the current round of World Trade Organisation trade negotiations. The fact that the EU acts as a single voice, on the basis of a mandate given to the Commission by member states, provides the EU and the UK with far greater clout in trade negotiations.
	This Bill calls for studies, but there have been a great number of studies by universities and university academics, who, as professional economists, have been, I hope, independent in what they have done. A major HMT/DTI paper earlier this year, The Single Market: A Vision for the 21st Century, goes through a huge number of the details. In response to the points made by the noble Lord, Lord Stoddart, about the euro, it would be hard to say, given the performance of the Chancellor, that the Government have been an absolute fan of joining the euro. I do not think that that can be said with any realism. Among the documents that have been so useful in the study of the economic performance of this country in relation to other countries, I ask with caution—I know that I am asking for a very big favour—Members of the House to go back to the 18 volumes that Gordon Brown published on whether we should be in the euro. They contain a huge wealth of evidence about the nature of our trading relations and the structure internally of our economy.
	In answer to the noble Lord, Lord Stoddart, we estimate that the total administrative burden on business in the voluntary sector—because I do not have the figures in front of me, I exclude here the financial services sector—in England derived from EU legislation is £6.3 billion. That represents 1.05 per cent of the amount spent in Europe, but I shall cross-check the figure to make sure that I have not myself confused euros and pounds in the data that I was provided with. That estimate suggests that other estimates are somewhat overstated.
	The other points made by the noble Lord, Lord Howell, about costs are also important, and as he and the noble Baroness, Lady Noakes, said, they arise particularly in relation to regulation. I do not know whether this will gain great popularity on my own Benches, but I am a deregulator by instinct, and I have often said so. I am in favour of sensible regulations, but it is possible for all countries, however free their markets, to end up with a level of regulation for which they had not calculated. I recall a speech made by former President Clinton, who said that, when he became the Governor of Arkansas, there were 135 state regulations in place on the use of a hammer by craftsmen. I do not believe that the state of Arkansas is one of those places where people have no regard for a proper and free market. We need to reduce regulation, and I accept that. It is undoubtedly true that we must see a change in the culture and the approach of Europe in this respect.
	In March, European leaders approved the Commission's ambitious target of reducing administrative burdens on business by 25 per cent by 2012. The Commission estimates that that will add 1.4 per cent to the European GDP. The Commission is starting to deliver by identifying the first four major burdens that have to be tackled, and, in my view, the emphasis on delivery is absolutely vital. There is no point in just writing these things down; they have to be done. Some 78 proposals have been withdrawn so far; the Commission is continuing to simplify the existing acquis, and around 140 simplification initiatives have been proposed. The proof of the pudding will be in the eating, of course, but at least we are beginning to move along a helpful path.
	There is an important role for legislative activity as well. The single market would not be able to operate without some rules and regulations that allowed competition but prevented protectionism and meant that cartels could not be readily built. We are looking for and are probably seeing a somewhat smarter and more flexible approach. For example, the emissions trading scheme and the code of conduct for clearing and settlement are innovative market-based approaches. I say to the noble Lord, Lord Willoughby de Broke, that I welcome a means of making sure that the disposal of old vehicles takes place safely without the escape of heavy metals, thus reducing the potential for disfigurement such as that in countries where cars are sometimes abandoned in heaps. The United Kingdom has driven this agenda. The 25 per cent EU recycling target reflects our domestic ambitions, and we are aiming for better regulation in general.
	Questions have also been raised on national security and the defence of the United Kingdom. I want to make the point to the noble Baroness, Lady Noakes, that of course our foreign policy has to be constructed in part through bilateral arrangements—indeed, she may have suggested that it is almost wholly due to them. If I have misunderstood the noble Baroness, I apologise unreservedly. Of course, even with bilateral arrangements, we have to have the capability in foreign policy terms of acting for ourselves. Of that there can be no question, but we are also a nation historically very dependent on our alliances. We work with others, and our security is in no small part due to that. I cannot imagine the past 50 to 60 years without the European security arrangements and NATO, and it is for that reason that I say to the noble Lord, Lord Howell, that I would not want to see any tangling-up that madethe role of NATO more difficult. It has been unquestionably one of the bastions of our freedoms, and that should be acknowledged.
	I shall reiterate the points that I made in the debate on 9 May. We can easily take Europe's stability for granted, but Europe has for centuries been disfigured by conflicts. Tens of millions of innocent Europeans have died in two world wars, and, in the second half of the last century, it was evident that we had to forge a different way. President Clinton rightly described this new architecture as the greatest and most successful example of "fixing in place"—I use his words—peace and community. Today the common foreign and security policy is delivering for the UK and the EU around the world. Twenty-seven member states are able to agree on common positions on issues ranging from regions in conflict through to Darfur and human rights around the world. Belarus, Burma and others are coming into the club and others are taking those positions; that is helpful.
	There will be a long discussion on the constitution next Thursday. I will not say a huge amount about it today because I have no doubt that a great deal will be said then. However, in response to the noble Lord, Lord Dykes, the strength and cohesion of sovereign states must be the key—the fulcrum, as he described it—and it is right that there is a balance between that and the advantages or otherwise of being in this club. The noble Lord, Lord Dykes, and I may or may not agree on exactly where that balance is, but there certainly has to be one.
	The EU is not in crisis in this respect; it is tackling important issues. The spring European Council agreement on climate change and on phone roaming charges, for example, shows that the work can be done.
	Institutional reform, though, is unquestionably required. I do not accept that we have reneged on anything. I do not at the moment know of specific new proposals that I can share with the House. I know what the general aspirations expressed by President Sarkozy and Chancellor Merkel are but I do not know what the specific proposals will be. I do know that there needs to be some tidying up of the arrangements in this club of 27, otherwise the inefficiencies that noble Lords have described will simply become embedded systematically. There is no purpose in that. If there is some tidying-up work of that kind to be done, it will not be a constitutional treaty. We want some limited amending arrangements for treaties, and that is not what was proposed in respect of a referendum, but we will have the chance to see them.
	I emphasise again—I know there is a great deal of common ground in the House on this—the importance of enlargement, for all the objectives I have described. Those include the attempts to bring Turkey closer to the family of nations.
	The Government attach huge importance to the United Kingdom's membership of the EU. We have strong reservations about the value of a committee of inquiry. It would be expensive and is likely to duplicate work done elsewhere. It would not help to forward the objectives we have either in Europe or for the United Kingdom—perhaps I should put them in the opposite order: for the United Kingdom and in respect of Europe—when we consider the key global challenges we face.
	I pay tribute to the noble Lord, Lord Pearson, for initiating the debate. I will close with his two questions because he is the fulcrum of the debate. There have been several signals during the day—I think it was five clubs, or perhaps one club. The noble Lord's first question was: do I believe that people really wish to stay in? Is there evidence of that?